Cabinet gives ‘In Principle’ approval for strategic disinvestment

No: --- Dated: Feb, 28 2019

The Cabinet Committee on Economic Affairs chaired by the Prime Minister has given 'in principle' approval for strategic disinvestment of 100% equity shares of Government of India in Kamarajar Port Limited (KPL) to Chennai Port Trust (ChPT) in a single stage process, by following ‘Arm’s length’ principles.

Presently, the Government of India and Chennai Port Trust hold 67% and 33% of shares respectively in Kamarajar Port Limited.   The methods of valuation, to be used shall include discounted cash flow, assets valuation and relative valuation as recommended by NITI Aayog.

This would help to avoid duplication of capacity creation in the ports. Better human resource management between the two ports will increase the efficiency of both Ports.

The strategic disinvestment of KPL shall be undertaken after conducting due diligence exercise by both the entities with the help of Advisors to be appointed for the transaction.

The approval is in the backdrop that ChPT and KPL will be able to evolve a clear policy on focus areas by devising the optimum business strategy and defining dedicated cargo profile.

Courtesy – Press Information Bureau, Government of India​​​​