MUMBAI : The Maharashtra government has veto powers over the transfer of Shipping Corporation of India’s (SCI) corporate headquarters in Mumbai and if it were to not approve the transfer, it could potentially thwart the central government’s privatisation plans for the state-owned shipping company, according to documents.
SCI’s privatisation is planned as a two-step process, which will involve the demerger of the non-core assets of the company including its corporate headquarters into a separate entity and the sale of the original company, which will house only the shipping business. The demerger is a necessary prerequisite for the privatisation.
According to sources, Maharashtra’s state government could have reservations over the transfer of Shipping House (SCI’s corporate headquarters) as this was originally given only for the use of SCI. Further, there are concerns that if the building were to be handed over to a private player, this could pose security risks as the building is located on Madame Cama Road, across the street from Mantralaya, the administrative headquarters of the state government of Maharashtra. This is also the office of Chief Minister Shri Uddhav Thackeray.
The demerger planned through a National Company Law Tribunal (NCLT)-approved scheme of arrangement mentions that two properties of the company, Shipping House and Maritime Training Institute (MTI Powai), a 44-acre campus located on the outskirts of Mumbai, will stay with the firm to ensure there is no business disruption till a buyer for SCI is found.
“Notwithstanding the effectiveness of the scheme, to ensure that there is no undue financial implications or disruptions for running the current operations of the company, the process of hiving off and alienation of MTI Powai and Shipping House will be made effective only after the transfer of management control of SCI to the acquirer under the strategic disinvestment. The transfer will be subject to the approval of the state government,” the scheme of arrangement documents read.
Emailed queries to the office of Uddhav Thackeray and to Maharashtra’s chief secretary did not elicit a response. The central government’s Department of Investment and Public Asset Management did not respond to requests for comment