"The divestment of Salem steel plant was scheduled for this year but has been delayed", SAIL chairman Arvind Pande told The Financial Express. The entire process of selecting a strategic partner for the oxygen plant may be completed by the end of the calendar year, he added. The four bidders for the Bhilai oxygen plant - BOC India, Praxair, Messers and Inox Air Products - have asked for more time. Regarding the company's business restructuring, Mr Pande said "the initial delays have been overcome with respect to power and oxygen plants, and we are targeting the benefits from such divestments to come in this fiscal itself". Though the process of divestment in the other two ventures - Salem steel plant and Indian Iron and Steel Company - is on this year, the returns would flow in the next fiscal, he added. SAIL has formed a fully owned subsidiary Bhilai Oxygen Ltd and is searching for a strategic partner for the company.

SBI Caps has been appointed the merchant bankers for the process. The merchant bankers received an `expression of interest' from four companies in response to a global tender floated in April this year. These companies have completed the process of due diligence which involves study of all documents relating to the unit as well as physical assessment of the plant to arrive at independent valuation estimates.

The entire process of selection of the joint venture partner was to be completed November 2000, but has now been extended.

Regarding the Salem steel plant, SAIL has shortlisted three parties - Tata Steel-Usinor combine, Avesta Sheffield and Jindal Strips based on the recommendations of JM Morgan Stanley. Earlier, the Tata Steel-Usinor combine and Avesta Sheffield had been shortlisted as they had fulfiled all the pre-qualification criteria. Some clarifications had been sought from the Jindals, who have now tied up with ALZ Ltd of Belgium, an Arbed group company and qualified. The fourth bidder, Shah Alloys Ltd, did not qualify and, hence not been shortlisted.