Disinvestment in India

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9.1 Overview of procedure
The procedure followed by Government of India for disinvestment seeks to promote administrative simplicity and speed of decision-making without compromising on transparency and fair play. The process is as follows:
· Proposals for disinvestments in any PSU, based on the recommendations of the Disinvestment Commission or in accordance with the declared Disinvestment Policy of the Government, are placed for consideration of the Cabinet Committee on Disinvestment (CCD).
· After CCD clears the disinvestment proposal, selection of the Advisor is done through a competitive bidding process.
· After receipt of the Expression of Interest (EOI), in pursuance of Advertisement in newspapers / website, advisors are selected based on objective screening in the light of announced criteria / requirements.
· Bidders are invited through advertisement in newspapers / website to submit their Expression of Interest. On receiving EOI from bidders, the advisors, after due diligence of the PSU, prepare the information memorandum in consultation with the concerned PSU. This is given to the short listed prospective bidders who have entered into a confidentiality agreement. The list of bidders is prepared after scrutiny of EOIs and those are shortlisted, who meet the prescribed qualification criteria. · The draft share purchase agreement and the shareholder agreement are also prepared by the Advisor with the help of the legal Advisors, and the final draft is prepared after detailed consultation with the bidders, in consultation with the Inter-Ministerial Group (IMG).
· The prospective bidders undertake due diligence of the PSU and hold discussions with the Advisor/ the Government/ the representatives of the PSU for any clarifications.
· Concurrently, the task of valuation of the PSU is undertaken in accordance with the standard national and international practices.
· Based on the feedback

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