Godawari Fert Selloff: Bidder Drags AP To HC

Hyderabad, June 27: | Updated: Jun 28 2003, 05:30am hrs
The disinvestment process in Godawari Fertiliser and Chemicals Ltd (GFCL), an Andhra Pradesh PSU, has suffered a temporary setback with one of the bidders approaching the state high court against disqualifying it from joining the biding process by the authorities concerned.

Responding to a petition filed by Krebs Biochemicals, the high court has ordered the state not to take a final decision on the bids till the court gives its final verdict. However, it allowed the government to open the price bids, as per schedule. Accordingly, the implementation secretariat, the nodal agency for the selloff process in state PSUs, has opened the bids on Friday.

The bid price of Coromandel Fertilisers promoted by the Chennai-based Murugappa Group at Rs 124 per share topped the list followed by two foreign contenders - Forskor Ltd at Rs 96 per share and Groupe Chimique Tunisien at Rs 70 per share.

At the bid price of Rs 124, Coromandal has to pay an aggregate of Rs 102.67 crore for the APs 25.88 per cent stake in the venture. Though we have opened the price bids today, the final decision on the bids will be taken after the court decided on the petition, implementation secretariat chairman DK Panwar told the media. The case was posted for further hearing on July 2.

Since Coromandel has mopped up over 14 per cent shares in Godavari through open market operations, the average price per share on the deal is expected to be at Rs 96 per share, sources pointed out. The scrip is now hovering around Rs 70 per share on the stock markets.

The secretariat has disqualified two of the contenders - Krebs Biochemicals and Kribhco on the technical grounds that the bidder has not furnished required documents. Protesting this decision, Krebs has moved the high court on Friday.

According to officials, Krebs bid failed to provide binding obligation to AP government on the part o Kerbs, SMS Pharma and Chemtech Fertiliser - the consortium partners in the bidding process - to be jointly and severally liable for the bid, which is essential for fathering the bidding process. Hence the bid was eliminated from evaluation, the official said.

The remaining three bids were evaluated by the committee in accordance with the criteria and weightage set out in the information memorandum of Godavari Fertilisers and all the three bidders were found eligible for scoring more than 75 points, sources said.