Govt. okays sale of Ferro Scrap Nigam Ltd. to Japanese firm for ₹320 crore

In what might be the primary privatisation transaction in over two years, the Centre on Thursday accepted the sale of MSTC subsidiary Ferro Scrap Nigam Restricted (FSNL), together with switch of administration management, to Konoike Transport Co. Ltd., a Japanese agency, for ₹320 crore.

FSNL, a 100% subsidiary of MSTC Ltd. beneath the Ministry of Metal (MoS), was integrated in 1979 to supply metal mill companies, and specialises within the restoration and processing of scrap from slag and refuge generated throughout iron and metal manufacturing.

The Cupboard Committee on Financial Affairs (CCEA) had granted an ‘in-principle’ approval for strategic disinvestment of MSTC’s complete stake in FSNL in October 2016. The Various Mechanism, a ministerial group empowered by the CCEA, accepted the best bid for FSNL of ₹320 crore from Konoike Transport, which is listed on the Tokyo Inventory Alternate.

“Konoike’s metal division is a long-established section of the corporate, with over 140 years of expertise in steelworks operations,” the Finance Ministry mentioned in a press release concerning the approval granted by the panel comprising Street Transport and Highways Minister Nitin Gadkari, Finance Minister Nirmala Sitharaman, and Metal Minister H. D. Kumaraswamy.

“The transaction now strikes to concluding stage. The following steps embody issuing the Letter of Award, signing the Share Buy Settlement (SPA), fulfilling the circumstances precedent as specified within the SPA by respective events, and shutting the transaction,” the Ministry mentioned. 

In January this 12 months, a plan to divest the Salem Metal Plant, a unit of SAIL, was scrapped, whereas the privatisation of Central Electronics and Pawan Hans needed to be junked after being introduced, owing to authorized issues concerning the profitable bidders. After Air India’s sale to the Tata Group, the final profitable strategic sale of a public sector unit was that of Neelachal Ispat Nigam Ltd. (NINL) to a Tata group agency, concluded in 2022-23.