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Govt announces guidelines for divestment advisors, bidders

The government on Friday announced guidelines for advisors and bidders for divestment in PSUs and is likely to issue show-cause notices to Hindujas, Videocon, Sterlite and Credit Suisse First Boston for their alleged involvement in various offences.

The guidelines follow a decision taken to this effect by the Cabinet Committee on Divestment last week for keeping the tainted companies out of the process of divestment.

When contacted, divestment ministry officials said that show-cause notices would be issued soon to Hindujas, who have bid for both Indian Airlines and Air-India, Videocon which has bid for Indian Airlines and VSNL and Sterlite, who are in the race for Hindustan Zinc Ltd and Hindustan Copper.

Notices would also be issued to CSFB, who are the advisors for VSNL privatisation, officials said on condition of anonymity.

While Hindujas have been chargesheeted in the Bofors case, Videocon and Sterlite have been named by the Securities and Exchange Board of India.

After getting their replies, the government would decide whether these could be qualified for continuation in the privatisation process, they said.

As per the guidelines, "any conviction in a court of law or indictment/adverse order by a regulatory authority for a grave offence against the advising concern and its sister concerns would constitute a disqualification".

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