List of State-Owned Enterprises ready for immediate privatization. 

In June, 1993 the Government decided to further activate and strengthen the role of private sector in trade and industry with a view to accelerating economic development. With this end in view the Government adopted a comprehensive privatization policy and laid down detailed procedure to facilitate the process of privatization. The policy is aimed at relieving the financial and administrative burden of government, improving efficiency and productivity, facilitating economic growth, reducing the size and presence of the public sector in the economy and help meeting the national economic goals. the salient features of the privatization policy and procedures are :  

METHODS OF PRIVATIZATION  

One of both of the following methods (having scopes of variations within the modes) are used at present for privatizing SOEs. *Sale by international tender* Local and foreign buyers may participate in all such tenders. Association of workers, employees and officers of the tendered enterprise may also offer bid for purchase of the enterprise. *Sale by public offer of shares* Government-Owned shares in different companies and shares of the SOEs converted into public limited companies may be sold to the general public either directly or through the stock exchange. 

PREPARATION OF SOEs FOR PRIVATIZATION 

Before inviting tender for sale of the identified SOEs, valuations of the assets and liabilities are made by Chartered Accountant (C.A.) firms or by the consultants engaged by the Board. Valuation reports are examined and reviewed by the Privatization Board and a re-valuation can be made by another C.A. firm/valuer firm if considered necessary. *Tenders* are invited after the finalization of the valuation. Valuation and other relevant documents are made available to the prospective bidders before submission of the bids.  

TENDER PROCEDURES  

1 In the case of sale of enterprise, the prospective buyers will submit quotation according to the term and conditions of the tender. Bidder shall have to accept all long-term loans against the fixed assets.  

2. Value of stocks and stores will be adjusted with the short-term bank liabilities and the buyer will accept the bank loan equivalent to the value of stocks and stores. If the value of stocks and stores exceeds the bank loans, the excess will be payable to the Government by the buyer either in cash or within one year along with a simple interest of 10% per annum. Bank loans in excess of the value of stocks and stores will be taken over by the Government.  

3. Value of current assets such as sundry debtors, advances etc. will be payable to the Government by the buyer either in cash or within one year along with a simple interest rate of 10% per annum.  
 

4. In the cases mentioned at 3.2 and 3.3, the buyer will have to provide irrevocable bank guarantee without recourse in case the payment is not made in cash.  

5. Short-term liabilities such as, sundry creditors, claims of employees and workers and income taxes etc. accrued before the transfer of the enterprise will be taken over by the Government.  

6. As regards employees of the tendered enterprise (if it is a running one) the Corporation and the buyer will jointly determine the number of redundant employees in the light of technical and operational feasibility. Retained employees, however, will be offered new terms and condition by the buyer.  

7. Buyers will be liable to pursue all pending court cases.  

8. Land under the enterprise will be used normally for establishment and expansion of industries. A substantial amount of unutilized but developed land can, however, be used for other productive activities.  

9. In case of sale of Government-owned shares in different companies the prospective buyers will submit quotations for the total number of shares offered for sale. The company whose shares are offered for sale, will repay all quasi-equity loans of the Government and dues of the corporations within a period of 10 years in 6-monthly installment carrying a simple interest of 10% per annum and will submit an irrevocable bank guarantee without recourse from a scheduled bank In addition to the above, the buyer will also give a personal irrevocable bank guarantee without recourse for the above quasi-equity loans and dues or will keep the share certificates of all the shares bought by him, under the custody of the government. @3.10 While implementing the policy of privatization efforts will be made to make the ownership of the industrial enterprises as broad-based, as possible.  
 

PROCESSING OF TENDER BIDS  
 

All tender bids received are examined by the Privatization Board as expeditiously as possible and its findings and recommendations are placed before the Council Committee on Economic Affairs for decision.  
 

PAYMENT PROCEDURE 

In case of sale of Government-owned shares in limited companies, the bidder will have to pay 20% of the bid amount as earnest money. The successful bidder will have to pay the balance 80% of the bid amount within 60 days of the issue of *Letter of Intent*. In case of sale of enterprise, the bidder will have to pay 2.5% of the bid amount as earnest money. The successful bidder will have to the pay in cash an additional amount of 22.5 % of the bid amount as down payment within 30 days of the issue of Letter of Intent (i.e. 2.5% + 22.5%). The bidder will have to pay the balance 75% of the bid amount within 5 years at 6-monthly installment along with a compound interest rate of 9% annually and will also give irrevocable bank guarantee without recourse for the installation payment. A rebate of 10% will be allowed if the full payment is made within 30 days of issue of Letter of Intent. In case of sale of enterprise to association of workers, employees and officers, all claims liabilities with the enterprise may be adjusted with the bid amount. The buyer will take over all long term loans and will have to negotiate repayment agreement with the lender institutions before transfer of the enterprise.