The government has put on hold the sale of Central Electronics (CEL) to Delhi-based firm Nandal Finance and Leasing, following allegations of undervaluation by the employees’ association.“The employees’ association has raised some allegations after the press release announcing the decision. These are being examined by the IMG (inter-ministerial group). Therefore, the letter of intent is put on hold,” Department of Investment and Public Asset Management secretary Tuhin Kanta Pandey told FE. “There’s already an existing case filed by employees in the Delhi High Court, praying for abandoning disinvestment,” Pandey said.
On November 29, the Cabinet Committee on Economic Affairs (CCEA)-empowered alternative mechanism (AM) comprising roads minister Nitin Gadkari, finance minister Nirmala Sitharaman and science minister Jitendra Singh had approved the highest price bid of Nandal Finance and Leasing Pvt for sale of 100% government stake in CEL for Rs 210 crore.
The next step was to issue the letter of intent and then sign the share purchase agreement, following which the conditions precedent would need to be satisfied by the successful bidder, the company and government. It was expected that the transaction would be completed by March 31.
In December, the opposition Congress party had alleged undervaluation of CEL and opposed it being sold to a firm which has “no domain experience”. A Congress party spokesperson had claimed that different methods would have put the valuation between
957 crore and1,600 crore.CEL, under the ministry of science & technology, works to commercially exploit indigenous technologies developed by national laboratories and R&D institutions in the country.