The Maharashtra state government is said to hold veto power over the transfer of Shipping Corporation of India headquarters in Maharashtra. If the state government doesn’t approve the transfer then it may block the central government’s privatisation plans for SCI.
Privatisation of the Shipping major will proceed in a two phase manner. In the first phase the non-core assets including the corporate headquarters will be demerged into a separate entity and the second phase will involve sale of the original company, which includes the shipping business.
It is reported that, 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, 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.
