Pawan Hans sale
Thread Starter
Pawan Hans sale
Pawan Hans sale finally to be concluded. Another example of a distressed helicopter company being sold to an entity with no experience in this arena. It will be very interesting to observe the outcome.
https://www.google.com/amp/s/wap.business-standard.com/article-amp/companies/govt-to-finalize-pawan-hans-sale-saturday-jsw-among-bidders-122042200710_1.html
https://www.google.com/amp/s/wap.business-standard.com/article-amp/companies/govt-to-finalize-pawan-hans-sale-saturday-jsw-among-bidders-122042200710_1.html
Thread Starter
The only buyers for any helicopter company these days are people with no experience, knowledge, or idea about what they are buying. Maybe these guys will become the Babcock of the East?
https://www.thehindu.com/news/nation...le65373464.ece
NEW DELHIMAY 01, 2022 22:41 IST
UPDATED: MAY 01, 2022 22:41 ISTCongress questioned why the government did not explore merging the firm with ONGC. File. | Photo Credit: The Hindu Photo Library
The Finance Ministry on Friday said Star9 Mobility Pvt Ltd will buy the government's 51% stake in helicopter services provider Pawan Hans Ltd (PHL), along with the transfer of management control, for ₹211.14 crore.
The reserve price for the strategic sale, which comes after three unsuccessful attempts, was fixed at ₹199.92 crore based on the valuation carried out by the transaction adviser and asset valuer.
Attacking the government over the decision, Congress spokesperson Gourav Vallabh said that in the series of miscalculated and injudicious disinvestment decisions to justify their financial policies, "they are committing a series of blunders".
The reserve price for the sale of this 51% majority stake was fixed at ₹199.92 crores and the other two bidders that participated made bids of ₹181.05 crore and ₹153.15 crore respectively, Mr. Vallabh pointed out.
Mr. Vallabh said while this may seem like a normal disinvestment, there are several things that raise eyebrows such as the the Star9 Mobility Private Ltd, a consortium of Big Charter Private Limited, Maharaja Aviation Private Limited and Almas Global Opportunity Fund SPC, set-up just six months ago on October 29, 2021.
Star9 Mobility Private Ltd doesn't have any helicopters of its own while Big Charter Private Limited has just 3 helicopters in its fleet, he said. Also, Almas Global Opportunity Fund SPC is set up under the jurisdiction of Cayman Islands and has no correlation or experience in this sector, he added.
Mr. Vallabh also claimed that there is a court case ongoing between Big Charter Private Limited and Ezen Aviation Private Limited in the Delhi High court He pointed out that Pawan Hans employee union expressed interest in participating in the disinvestment process and had also recommended that Pawan Hans be merged with ONGC or made a subsidiary company but the government "brushed it off".
"Pawan Hans made a net profit of Rs. 242.78 crore in 2016-17 but has gone downhill since 2018-19 making losses of Rs 63.67 crores in 2018-19 and Rs 33.15 crores in 2019-20," he said.
Posing questions for the Modi Government over the decision, Mr. Vallabh said that with details available about the bidders and their consortium there are red flags, and how did the government agree to such a deal.
"There were three bidders that participated in the disinvestment process but only one bidder bid over the reserve price. What was the government's reason to go ahead with just one proper bid?" Mr. Vallabh said.
Did the government explore merging Pawan Hans with ONGC, keeping in mind they already have 49 per cent stake and Pawan Hans playing a very strategic role with ONGC, HAL etc., he asked.
Pointing out that a company that has been consistently making net profits suddenly starts making losses since 2018-19 around the same time when the disinvestment was first processed, Mr. Vallabh asked is this again an attempt to lower the valuation to ease sale to someone who would benefit.
Mr. Vallabh pointed out that Pawan Hans is South-East Asia's largest helicopter company with a fleet of 42 Helicopters
Off shore operations, connecting inaccessible areas, charter services, search and rescue work, VIP transportation, corporate and special charter flights, hotline washing of insulators and Heli-pilgrims such to Kedarnath, Badrinath, Amartnath, Maa Vaishno Devi, are some of its major services.
Loss-making PHL is a 51:49 joint venture of the government and ONGC. ONGC had earlier decided to offer its entire shareholding to the successful bidder identified in the government strategic disinvestment transaction, on the same price and terms as the government.
The government in December last year received three financial bids for buying the company.
Mr. Vallabh accused the BJP of inept handling of the economy and said after eight years of disastrous financial management, the economy is reeling.
The BJP government has forced sectors to the end of their tethers that needed support and have magically made good companies and sectors struggle, he alleged.
They are violating all prudence and common logic to find a way out of the financial mismanagement caused in the last 8 years, Mr. Vallabh said.
Pawan Hans has been incurring losses in the last three years (FY-19, FY-20 and FY-21). It has a fleet of 42 helicopters of which 41 are owned by the company.
The owned helicopters have an average age of over 20 years and three-fourths of them are presently not being manufactured by the original equipment manufacturer.
https://www.thehindu.com/news/nation...le65373464.ece
Congress raises questions over Pawan Hans disinvestment, asks why merger with ONGC not explored
NEW DELHIMAY 01, 2022 22:41 IST
UPDATED: MAY 01, 2022 22:41 ISTCongress questioned why the government did not explore merging the firm with ONGC. File. | Photo Credit: The Hindu Photo Library
The Finance Ministry on Friday said Star9 Mobility Pvt Ltd will buy the government's 51% stake in helicopter services provider Pawan Hans Ltd
The Congress on Sunday raised questions over the deal to sale Centre's 51% stake in helicopter services provider Pawan Hans Ltd (PHL), asking why the government did not explore merging the firm with ONGC instead of deciding to hand it over to a consortium that is just six-months-old.The Finance Ministry on Friday said Star9 Mobility Pvt Ltd will buy the government's 51% stake in helicopter services provider Pawan Hans Ltd (PHL), along with the transfer of management control, for ₹211.14 crore.
The reserve price for the strategic sale, which comes after three unsuccessful attempts, was fixed at ₹199.92 crore based on the valuation carried out by the transaction adviser and asset valuer.
Attacking the government over the decision, Congress spokesperson Gourav Vallabh said that in the series of miscalculated and injudicious disinvestment decisions to justify their financial policies, "they are committing a series of blunders".
The reserve price for the sale of this 51% majority stake was fixed at ₹199.92 crores and the other two bidders that participated made bids of ₹181.05 crore and ₹153.15 crore respectively, Mr. Vallabh pointed out.
Mr. Vallabh said while this may seem like a normal disinvestment, there are several things that raise eyebrows such as the the Star9 Mobility Private Ltd, a consortium of Big Charter Private Limited, Maharaja Aviation Private Limited and Almas Global Opportunity Fund SPC, set-up just six months ago on October 29, 2021.
Star9 Mobility Private Ltd doesn't have any helicopters of its own while Big Charter Private Limited has just 3 helicopters in its fleet, he said. Also, Almas Global Opportunity Fund SPC is set up under the jurisdiction of Cayman Islands and has no correlation or experience in this sector, he added.
Mr. Vallabh also claimed that there is a court case ongoing between Big Charter Private Limited and Ezen Aviation Private Limited in the Delhi High court He pointed out that Pawan Hans employee union expressed interest in participating in the disinvestment process and had also recommended that Pawan Hans be merged with ONGC or made a subsidiary company but the government "brushed it off".
"Pawan Hans made a net profit of Rs. 242.78 crore in 2016-17 but has gone downhill since 2018-19 making losses of Rs 63.67 crores in 2018-19 and Rs 33.15 crores in 2019-20," he said.
Posing questions for the Modi Government over the decision, Mr. Vallabh said that with details available about the bidders and their consortium there are red flags, and how did the government agree to such a deal.
"There were three bidders that participated in the disinvestment process but only one bidder bid over the reserve price. What was the government's reason to go ahead with just one proper bid?" Mr. Vallabh said.
Did the government explore merging Pawan Hans with ONGC, keeping in mind they already have 49 per cent stake and Pawan Hans playing a very strategic role with ONGC, HAL etc., he asked.
Pointing out that a company that has been consistently making net profits suddenly starts making losses since 2018-19 around the same time when the disinvestment was first processed, Mr. Vallabh asked is this again an attempt to lower the valuation to ease sale to someone who would benefit.
Mr. Vallabh pointed out that Pawan Hans is South-East Asia's largest helicopter company with a fleet of 42 Helicopters
Off shore operations, connecting inaccessible areas, charter services, search and rescue work, VIP transportation, corporate and special charter flights, hotline washing of insulators and Heli-pilgrims such to Kedarnath, Badrinath, Amartnath, Maa Vaishno Devi, are some of its major services.
Loss-making PHL is a 51:49 joint venture of the government and ONGC. ONGC had earlier decided to offer its entire shareholding to the successful bidder identified in the government strategic disinvestment transaction, on the same price and terms as the government.
The government in December last year received three financial bids for buying the company.
Mr. Vallabh accused the BJP of inept handling of the economy and said after eight years of disastrous financial management, the economy is reeling.
The BJP government has forced sectors to the end of their tethers that needed support and have magically made good companies and sectors struggle, he alleged.
They are violating all prudence and common logic to find a way out of the financial mismanagement caused in the last 8 years, Mr. Vallabh said.
Pawan Hans has been incurring losses in the last three years (FY-19, FY-20 and FY-21). It has a fleet of 42 helicopters of which 41 are owned by the company.
The owned helicopters have an average age of over 20 years and three-fourths of them are presently not being manufactured by the original equipment manufacturer.
Thread Starter
How on Earth do these negotiations get this far without a full qualification of the potential purchasers - unless they are so desperate to divest themselves of this organization that they just don't care?
https://www.indiatoday.in/amp/india/...061-2022-05-16
Sale of Pawan Hans put on hold by Centre over winning bidder concerns
Centre has put the sale of helicopter service provider Pawan Hans on hold over concerns about the winning bidder.
Poulomi Saha
New Delhi
May 16, 2022UPDATED: May 16, 2022 15:26 IST
The Cabinet Committee on Economic Affairs approved the sale of the government's 51% stake in Pawan Hans in late 2016. (File photo)
Sale of Pawan Hans put on hold by Centre
Concerns were raised over the winning bidder
Centre had approved the sale in late 2016
The Centre has decided to put on hold the sale of public sector helicopter service provider, Pawan Hans Limited to Star9 Mobility Private Limited. The decision comes after concerns were raised over one of the majority stakeholders of Star9 Mobility.
Questions were raised over the majority stakeholder Almas Global Opportunity Fund and the background of the winning bidder.
On April 29, an empowered cabinet group had given the green signal for Star9 Mobility to buy the government’s 51 per cent stake in the loss-making Pawan Hans.
Oil and Natural Gas Corporation (ONGC), that held the rest of the 49 per cent had also offered its entire shareholding to the winning bidder at the same price per share, as per the terms agreed by the government.
Star9 Mobility Private Ltd is made up of three different entities Maharaja Aviation Private Limited (25% stake), Private Limited (26%) and Almas Global Opportunity Fund (49%). Very little is known about the winning bidder.
What is known though is that on April 22, the Kolkata-bench of the National Company Law Tribunal sanctioned Cayman Islands-based Almas Global, in a case involving a Kolkata-based company called EMC Limited, which Almas had successfully bid to acquire for Rs 568 crore after EMC entered an insolvency resolution plan, but then failed to pay up.
NCLT, in its order, had strongly reprimanded Almas for its failure, and called for action against the company under Section 74(3) of the Insolvency and Bankruptcy Code. It had also asked for a copy of its order to be sent to the Insolvency and Bankruptcy Board of India and the Secretary, Ministry of Corporate Affairs.
Top sources involved in the divestment of Pawan Hans have now told India Today that they will do a legal examination of the NCLT order before proceeding further with the sale. They clarified that a letter of award has not been issued
https://www.indiatoday.in/amp/india/...061-2022-05-16
Sale of Pawan Hans put on hold by Centre over winning bidder concerns
Centre has put the sale of helicopter service provider Pawan Hans on hold over concerns about the winning bidder.
Poulomi Saha
New Delhi
May 16, 2022UPDATED: May 16, 2022 15:26 IST
The Cabinet Committee on Economic Affairs approved the sale of the government's 51% stake in Pawan Hans in late 2016. (File photo)
Sale of Pawan Hans put on hold by Centre
Concerns were raised over the winning bidder
Centre had approved the sale in late 2016
The Centre has decided to put on hold the sale of public sector helicopter service provider, Pawan Hans Limited to Star9 Mobility Private Limited. The decision comes after concerns were raised over one of the majority stakeholders of Star9 Mobility.
Questions were raised over the majority stakeholder Almas Global Opportunity Fund and the background of the winning bidder.
On April 29, an empowered cabinet group had given the green signal for Star9 Mobility to buy the government’s 51 per cent stake in the loss-making Pawan Hans.
Oil and Natural Gas Corporation (ONGC), that held the rest of the 49 per cent had also offered its entire shareholding to the winning bidder at the same price per share, as per the terms agreed by the government.
Star9 Mobility Private Ltd is made up of three different entities Maharaja Aviation Private Limited (25% stake), Private Limited (26%) and Almas Global Opportunity Fund (49%). Very little is known about the winning bidder.
What is known though is that on April 22, the Kolkata-bench of the National Company Law Tribunal sanctioned Cayman Islands-based Almas Global, in a case involving a Kolkata-based company called EMC Limited, which Almas had successfully bid to acquire for Rs 568 crore after EMC entered an insolvency resolution plan, but then failed to pay up.
NCLT, in its order, had strongly reprimanded Almas for its failure, and called for action against the company under Section 74(3) of the Insolvency and Bankruptcy Code. It had also asked for a copy of its order to be sent to the Insolvency and Bankruptcy Board of India and the Secretary, Ministry of Corporate Affairs.
Top sources involved in the divestment of Pawan Hans have now told India Today that they will do a legal examination of the NCLT order before proceeding further with the sale. They clarified that a letter of award has not been issued
Thread Starter
https://thewire.in/business/pawan-ha...yman-firm-nclt
Photo: @PawanHansLtd
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3 HOURS AGONew Delhi: On April 29, 2022, the Cabinet Committee on Economic Affairs approved Star9 Mobility Private Limited’s bid to buy the government’s 51% stake in public sector helicopter service provider Pawan Hans Limited for Rs 211 crore. Two weeks later, several questions about the privatisation of this once-iconic public sector company remain unanswered and there are questions about the identity of its new owner.
Star9 Mobility is a consortium of three different entities – Maharaja Aviation Private Limited, which owns 25%, Big Charter Private Limited (with 26%) and Almas Global Opportunity Fund with the remaining 49%. The consortium will also acquire the remaining 49% of Pawan Hans – which belongs to the public sector energy giant ONGC – at the same price per share.
A Ministry of Finance press release stated: “The strategic disinvestment transaction was implemented through an open, competitive bidding process supported by a multi-layered consultative decision making mechanism involving (an) Inter-Ministerial Group, (a) Core Group of Secretaries on Disinvestment and the empowered Alternative Mechanism.”
Our investigation shows that this ‘transparent’ decision based on a “multi-layered consultation” has resulted in the purchase of Pawan Hans by a consortium whose leading stakeholders have placed little or no information in the public domain about themselves and their ability to run such a company. In fact, the largest stakeholder in the consortium has been sanctioned by the National Company Law Tribunal (NCLT) and it is not clear whether it has fully met the eligibility criteria laid down by the government for bidders.
This is not the first time the Narendra Modi government’s sale of government assets to private companies has raised questions about the new owners. In January, the government was forced to put on hold the sale of Central Electronics Limited after doubts were raised about the winning bidder’s financial track record, the cases pending against it in the NCLT and questionable inter-connections among bidders.
Pawan Hans: A national asset
Pawan Hans was founded in 1985 as a joint venture of the Ministry of Civil Aviation and the public sector Oil and Natural Gas Corporation (ONGC). It is the largest helicopter service provider in the country.
In the past three years, Pawan Hans has been registering losses. In FY18-19, it recorded its worst loss of around Rs 70 crore, which has improved to losses of around Rs 18.5 crore in FY19-20 and around Rs 17.6 crore in FY20-21. This came after a sharp profit that it registered in FY16-17 of Rs 254 crore. That year, the government converted the debt of Rs 130 crore that Pawan Hans owed it into equity and wrote off interest dues of around Rs 339 crore – which is what had resulted in the high profit. In the year that preceded it, that is FY15-16, the company had made a profit of around Rs 57 crore. In the year that followed, that is FY17-18, the company made a profit of around Rs 20 crore. The chart and table below track its revenue and profits since 2016.
Financial Performance of Pawan Hans Limited (all figures in Rs crore)
Financial year FY16 FY17 FY18 FY19 FY20 FY21 Revenue 491.67 507.73 458.02 414 376.75 401.71 Profit 57.17 254.09 20.23 -70.49 -18.53 -17.61
In the information memorandum seeking expressions of interest in Pawan Hans issued by SBI Capital Markets (that had been appointed transaction adviser for the disinvestment process) in December 2020, various explanations are provided for why the company’s revenue started to fall in 2016, leading to the company going into losses two years later (notwithstanding the extraordinary gains owing to the debt write off and debt to equity conversion by the government in 2017). The document said that three accidents in 2015 accounted for a drop in revenue from operations from 2016 onwards. Due to these accidents, the insurance cost of the helicopters had also risen, the document added. Revenue further declined in 2020 due to the ageing of helicopters. As of March 31, 2020, the document said, five helicopters are not operational as they could not be repaired due to spare parts not being available, and one helicopter had been dispatched to Russia for an overhaul. Revenue from operations had further been impacted, the document said, due to the decline in revenue from consultancy services towards development of heliports.
Despite these fluctuations in its financial performance however, Pawan Hans is a national asset. Its fleet of 43 helicopters (of which 37 are currently operational) serves the offshore operations of oil and gas companies and provides transportation in the Andaman & Nicobar Islands and Lakshadweep. It connects remote and inaccessible parts of the country, including areas of north-east India, Jammu & Kashmir and Uttarakhand, for tourists and VIPs as well as for government personnel.
Pawan Hans also provides its helicopters for search and rescue operations during natural calamities, carries personnel and material for the Border Security Force, the Border Roads Organisation, supports the Power Grid Corporation, and helps in the surveillance of pipelines of not just ONGC, but GAIL and Oil India Limited as well. Pawan Hans helicopters have been deployed by the security forces and have been chartered for a variety of purposes by private persons and government bodies.
Will the Star9 Mobility consortium be able to handle this diverse range of activities? Let us look at the record and capabilities of its three constituent companies.
Maharaja Aviation Private Limited, operator with three choppers
Maharaja Aviation was incorporated on October 8, 2008 in Indore. Its directors are Sumit Sawhney and Suchin Sawhney. According to an April 15, 2022 Director-General of Civil Aviation (DGCA) report, this company is “a non-scheduled aircraft operator and operates three small helicopters” – two four-seaters and one three-seater.
Between 2013-14 and 2020-21, the company earned a profit only once, Rs 4.92 lakh in 2019-20. In this period, the highest revenue it earned was Rs 9.13 crore in 2017-18. On March 31, 2021, Maharaja Aviation’s total assets were worth Rs 1.35 crore, and the company’s total borrowing stood at Rs 8.07 crore. Its net worth was negative at minus Rs 7.59 crore.
Maharaja Aviation’s https://www.facebook.com/Maharaja.Robinson/ has publicised some high profile clients who availed of its helicopter services through 2017 and 2018. These include Bollywood actor and Bharatiya Janata Party (BJP) MP
, Bollywood actor
, yoga guru
and his business partner
(who is CEO and MD of Patanjali Ayurved Limited).
Choppy journey of Big Charter Private Limited
Big Charter was incorporated in Mumbai on December 13, 2014 by a former pilot with the erstwhile Kingfisher Airlines, Captain Sanjay Mandavia. The company’s LinkedIn page states that it is in the business of truck transportation. Mandavia is a founding member of the Flight Simulation Technique Centre, a company that provides flight simulation services to train pilots of various aircraft.
In 2020, Big Charter won a tender floated by the Meghalaya Transport Corporation to operate a direct flight between Shillong and Delhi twice a week. It started the operation under the name ‘flybig’ airlines in December 2020, with a Bombardier Dash 8 Q400 turboprop aircraft leased from SpiceJet. A few months later, for reasons that are not clear, SpiceJet discontinued its aircraft lease contract with Big Charter and the Shillong to Delhi service stopped. An agitated Meghalaya government then served a show-cause notice on the company in December 2021.
After Big Charter failed to resume operations, Mohendro Raspang, an opposition Member of the Legislative Assembly (MLA) asked the state’s transport minister: “Is it prudent to sign an agreement with an operator who has no aircraft or shouldn’t we look at options where we sign an agreement with an operator who has at least one or two aircraft of its own?”
Dasakhiatbha Lamare, Meghalaya’s transport minister, replied that ‘flybig’ has “promised us that it will avail an aircraft…(a) Bombardier Q400.” He added: “Since this was the first experience, it was a lesson for us. Let us see by the end of this month if the airline can provide us the services we need or else we will take another step.”
By the middle of 2021, Big Charter was reported to be in financial distress and was looking for investors with deep pockets. It started defaulting on payment of salaries and taxes. Many employees, including its chief executive officer (CEO) and chief financial officer (CFO), left the company. At that juncture, it was operating its two ATR aircraft to 13 destinations on 16 daily flights.
In its annual returns for 2020-21, the company mentioned three principal business activities that generated the following proportions of its income: passenger and charter services (24.85%), fees for training students (18.35%) and foreign commission (56.8%). In 2019-20, for the first time, the company booked a profit of a little over Rs 1 lakh. This figure jumped to Rs 98.45 lakh in the following financial year. Big Charter had a net worth of approximately Rs 9.5 crore on March 31, 2021.
On March 26, 2022, the Ministry of Civil Aviation
that ‘flybig’ airlines had signed a letter of intent to acquire up to ten Twin Otter Series 400 aircraft from Canada’s de Havilland Air “to assist in serving small and remote communities which previously didn’t have access to air travel.”
@flybigairlines signed a Letter of Intent to acquire up to 10 Twin Otter Series 400 Aircrafts from @dehavillandAIR of Canada to assist in serving small & remote communities which previously didn’t have access to air travel. (1/2)#WingsIndia2022#AzadiKaAmritMahotsav pic.twitter.com/FOvjfjFGaW
— MoCA_GoI (@MoCA_GoI)
Ten Twitter handles were tagged by the Ministry of Civil Aviation (MoCA) – those of Union Minister of Civil Aviation Jyotiraditya Scindia; the Federation of Indian Chambers of Commerce and Industry of India (FICCI); Usha Pandhee and Amber Dubey, both joint secretaries in the MoCA; the main and ministerial offices of the Press Information Bureau; General V.K. Singh, Minister of State, Civil Aviation; Amrit Mahotsav (a government initiative to celebrate 75 years of India’s independence); Wings India 2022 (a three-day event on civil aviation that was organised by the Union government in Hyderabad during 24-27 March) and Pawan Hans Ltd.
Why did MoCA chose to tweet information about a small regional airline with two leased aircraft signing a letter of intent to procure 10 small aircraft? Why was Pawan Hans tagged? How was the public sector company connected to the deal involving Big Charter’s ‘flybig’ given the former is a helicopter company and has nothing to with airplanes? Was the tweet an indication of what was to come?
These questions are significant because the transfer of a controlling interest in Pawan Hans to the consortium that included the owner of ‘flybig’ airlines – Big Charter – was announced a whole month later, on April 29.
The registration details of ‘flybig’ published by DGCA states that as on April 15, 2022, it operated two leased ATR 72-212A type aircraft, each with 72 seats. The airline had added a Q400 aircraft on a wet-lease from Ethiopian Airlines with crew to its fleet on April 28. (In a wet-lease, the organisation that owns the aircraft provides crew members along with the leased aircraft to another organisation and is also responsible for maintenance of the aircraft and insurance cover.)
Also read: Air India Rolls Out Red Carpet for Aviation Secy, Wife, Upgrades Tickets to Business Class for Cheap
Little known of Cayman-based Almas Global Opportunity Fund SPC
The third member of the consortium that constitutes Star9 Mobility, Almas Global Opportunity Fund SPC (AGOF), is an entity registered in the Caribbean tax haven, the Cayman Islands. AGOF’s website discloses little about the company but mentions a wide array of sectors in which it invests.
This fund, as it claims, was incorporated in November 2017. Its minimalist website states that the “primary objective of the Fund is to provide its shareholders with maximum short to medium term capital appreciation through a combination of debt and equity investment. Fund many sub-funds that diversify over different strategies like Trade Finance, Real Estate, Fixed Income and Renewable Energy.”
The website of the parent company of the fund, Almas Capital Limited, adds: “The Fund is in Segregated Portfolio Company (SPC) structure, and invests in companies through Debt or Equity.”
Almas Capital introduces itself as a Dubai-based “financial services company” and like the website of the fund, the information that has been publicly provided is sparse. Unlike several other similar corporate entities, information about the people behind the company including their educational and professional background is absent. The Almas Capital website does not have an address and names no employee or contact person but lists a generic email address and a United Arab Emirates (UAE) phone number.
The section of the website titled “track record” is reproduced below.
The information given indicates that the company has not yet invested or raised funds.
Amardeep Sharma. Photo: LinkedIn
In December 2021, several publications in India reported that a start-up named Jupitice, an AI/ML (artificial intelligence/machine learning) and blockchain-based technology platform, had announced that Almas Capital (also known as Almas Caps) had raised $4 million for the start-up. This is not mentioned on the website of Almas Capital. These news reports mention Amardeep Sharma as the managing director of Almas Capital.
According to his LinkedIn profile, Sharma was the managing director of Almas Capital between March 2017 and November 2020. Subsequently, he has been the senior executive officer and member of the board of directors of Greenback Capital Limited.
Who then are the people behind Almas Capital, which raised $4 million for Jupitice and leads the Star9 Mobility consortium (by virtue of owning the single largest stake in it) that acquired control over Pawan Hans?
The answer lies in the website of another company, Greenback Capital. Unlike Almas Capital, this website provides details about the company’s core team and other employees. Amardeep Sharma is the chairman and member of the company’s board of directors. And, it turns out, on its website Greenback Capital claims to be the company that raised funds for Jupitice.
Greenback Capital has a regulated licence and is registered with the Dubai International Financial Centre (DIFC). It was incorporated on 28 October 2020 and has an office in the DIFC. Amardeep Sharma, Charudutta Joshi and A**** Mahendra Mehta are its directors.
The firm’s website doesn’t mention Mehta anywhere but lists two more directors, Ramen Ray Mandal and Habeeb Ahmed. Mandal is a director in Star9 Mobility. Mehta is one of the directors in Parmes Diamonds Exports Private Limited, a Surat-based diamond export firm.
NCLT verdict against Almas Global Opportunity Fund
On April 22, 2022, the Kolkata bench of the National Company Law Tribunal (NCLT) passed an order in a case that involved Almas Global.
The case concerned the acquisition of EMC Limited, a Kolkata-based company that provides systems used in power transmission and distribution equipment, by Almas Global, through the Corporate Insolvency Resolution Process. Almas Global Opportunity Fund had successfully bid to acquire EMC Limited after the company had entered the insolvency resolution process in 2019. According to the case before the NCLT that had been brought by the resolution professional, Almas Global had failed to pay around Rs 568 crore to EMC’s creditors under the resolution plan that it had proposed, and which had been accepted. Further, the petitioner to the NCLT alleged that Almas Global was repeatedly making a variety of excuses for failing to pay and discharge its duties towards implementing the resolution plan.
The NCLT’s order flayed the conduct of Almas Global and accused it of “wilful contravention of the approved resolution plan”. The tribunal ordered that two performance bank guarantees amounting to Rs 30 crore submitted by Almas Global be forfeited, and that the company and its officers be proceeded against. Specifically, the NCLT called for a copy of its order in the case to be sent to the secretary, Ministry of Corporate Affairs and to the Insolvency and Bankruptcy Board of India, the agency authorised to initiate a complaint against Almas Global and its officers.
The NCLT’s order noted multiple violations by the company and its authorised representative, Amardeep Sharma. It said that Sharma “tried to mislead the court” and that Almas Global “has taken the entire process for a ride.”
Interestingly, in one of his affidavits filed before the tribunal, Sharma claimed that he couldn’t disclose commercial information related to the funding of the resolution plan due to the confidentiality laws prevailing in the Cayman Islands, a tax haven. The NCLT described this move as “impudent” and said that “it seems to assume that the judicial authorities in India cannot understand anything beyond the limited territorial jurisdiction of India.” “It is so brazen that it is almost laughable, if not for the solemnity of these proceedings,” the tribunal continued about the affidavit.
The NCLT said that its order should be sent to the secretary, Ministry of Corporate Affairs. The secretary reports to the minister – in this case, Union finance minister Nirmala Sitharaman (who is also in charge of the Ministry of Corporate Affairs) and a member of the Cabinet Committee on Economic Affairs (CCEA) which approved the disinvestment plan of Pawan Hans Limited on April 29.
Was Sitharaman aware of the order by the adjudicating authority asking the ministry to take legal action against Almas Global Opportunity Fund and its representative Amardeep Sharma? Did she share this information with her ministerial colleagues in the CCEA? Even after knowing these facts, what prompted the government to go ahead with the offer submitted by Star9 Mobility? Did the consortium disclose the names and other details of the “real” or “beneficiary” owners of Almas Global and the way it would raise funds for the acquisition to the CCEA?
Eligibility criteria fully met?
The story does not end here. “The Preliminary Information Memorandum for Inviting Expression of Interest for Strategic Disinvestment of Pawan Hans Limited by Government of India,” published on December 8, 2020, explains the Eligibility Criteria for the Interested Bidders (IB) from page 47 onwards in the document.
It is unclear if Star9 Mobility meets two relevant eligibility criteria. The first criterion is that Almas Global must be registered with the Securities and Exchange Board of India (SEBI), the regulator of the country’s financial markets, as an Alternative Investment Fund (AIF) to make it eligible to invest in India. However, the names of Almas Capital Limited, Almas Global Opportunity Fund and Greenback Capital are not listed in SEBI’s published list of Registered AIFs.
Then comes the issue of net worth. The financial criteria for eligibility state that a bidder for a public sector company (including Pawan Hans) must have a minimum net worth of Rs 300 crore, taken as a sum of the net worth of all the members of the consortium. For a consortium comprising both Air Transit Service Operators (ATSOs) and non-ATSOs, the criteria state the following: ATSOs can hold up to 51% equity stake in a consortium and if their net worth is negative, it will be considered as nil for the purposes of the bid, and the non-ATSO entity/entities that hold/s the rest in the consortium must make up the minimum net worth requirement of Rs 300 crore.
As the bids had to be submitted before the closure of the financial year, that is March 31, 2022, it is safe to assume that the net worth of these three companies would have been evaluated based on their fully audited financial results of the previous financial year, 2020-21. According to these criteria, Maharaja Aviation had a negative net worth of Rs 7.59 crore. Big Charter’s net worth, on March 31, 2021, was around Rs 9.5 crore. These two companies are ATSOs. Thus, if the consortium had to have a total net worth of Rs 300 crore, the difference would have to be made up by Almas.
No information is publicly available on AGOF’s net worth. The NCLT order clearly stated that Almas Global Opportunity Fund could not raise enough money to pay the dues to EMC’s creditors of around Rs 568 crore for nearly one and a half years. In such a scenario, it is the responsibility of the CCEA to clarify as to how it concluded that Star9 Mobility, including Almas Global, had the required net worth of Rs 300 crore to be a bidder for Pawan Hans? If Almas Capital and Greenback are the same, the Dubai International Financial Centre clearly mentions that Greenback has a share capital of just $1 million that is held by Amardeep Sharma.
Unnamed government sources ‘clarify’
In the days following the announcement of the sale, with the Congress party questioning the government on the disinvestment process, a clarification has appeared in a section of the media quoting anonymous government officials.
In an article published on May 6, The Hindu quoted an unnamed “senior official” of the Department of Investment and Public Asset Management (DIPAM) as claiming: “One of the distorted arguments we have heard is that the successful entity has a net worth of ₹1 lakh instead of the ₹300-crore net worth we had stipulated…This is a misinterpretation of facts at best.”
The news report quoted the unnamed DIPAM official as adding: “After the preliminary information memorandum was issued, the three partners of the winning consortium had submitted proof of a combined net worth of ₹699.49 crore. This was updated again at the time we called for bids to ₹710.08 crore…At both stages, all three submitted their updated financial statements for the past 12 months.”
An article in India Today, also published on May 6, contains an identical quote attributed to a “senior DIPAM source” and includes what appears to be a screenshot from an unidentified document, which is a table listing the members of the Star9 Mobility consortium, their stake in the consortium, their status as ATSOs or non-ATSOs and their net worth. Maharaja Aviation and Big Charter are both shown as ATSOs with nil net worth, and Almas Global, the non-ATSO, is shown as having a net worth of Rs 691 crore.
If these claims are true, it would mean that Almas Global turned over financial information to the government as a part of its bid that it refused to hand over to the NCLT in the case regarding EMC Limited, wherein it had cited the confidentiality laws of Cayman Islands. Why this discrepancy?
If documents are available with the government proving Almas Global’s net worth, shouldn’t these be available for public scrutiny, by a constitutional authority such as the Comptroller and Auditor General?
Who are the real players behind this sale of a national asset? And who are the actual beneficiaries?
We emailed questionnaires to the following 11 individuals in the afternoon of May 9: Union minister of civil aviation Jyotiraditya Scindia; secretary, civil aviation, Pradeep Singh Kharola; Union minister of finance and corporate affairs Nirmala Sitharaman; minister of state for finance and corporate affairs Pankaj Choudhary; finance secretary Dr T.V. Somanathan; secretary, corporate affairs, Rajesh Verma; minister for road transport and highways Nitin Gadkari (who is also a member of the Cabinet Committee on Economic Affairs); secretary, road transport and highways Giridhar Aramane; Captain Sanjay Mandavia of Big Charter; Sumit Sawhney of Maharaja Aviation; and Amardeep Sharma of Greenback Capital.
Till the time of publication, no response had been received from any of the 11 persons named above. The article will be updated as and when their responses are received.
The authors are independent journalists.
Pawan Hans Sale: Cayman Firm in Winning Bid Flayed By NCLT for Failure to Pay, Show Funding Plan
The privatisation of the public sector helicopter operator raises questions that the government so far has refused to answer. An investigation by The Wire and NewsClick.Photo: @PawanHansLtdSupport UsListen to this article:
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3 HOURS AGONew Delhi: On April 29, 2022, the Cabinet Committee on Economic Affairs approved Star9 Mobility Private Limited’s bid to buy the government’s 51% stake in public sector helicopter service provider Pawan Hans Limited for Rs 211 crore. Two weeks later, several questions about the privatisation of this once-iconic public sector company remain unanswered and there are questions about the identity of its new owner.
Star9 Mobility is a consortium of three different entities – Maharaja Aviation Private Limited, which owns 25%, Big Charter Private Limited (with 26%) and Almas Global Opportunity Fund with the remaining 49%. The consortium will also acquire the remaining 49% of Pawan Hans – which belongs to the public sector energy giant ONGC – at the same price per share.
A Ministry of Finance press release stated: “The strategic disinvestment transaction was implemented through an open, competitive bidding process supported by a multi-layered consultative decision making mechanism involving (an) Inter-Ministerial Group, (a) Core Group of Secretaries on Disinvestment and the empowered Alternative Mechanism.”
Our investigation shows that this ‘transparent’ decision based on a “multi-layered consultation” has resulted in the purchase of Pawan Hans by a consortium whose leading stakeholders have placed little or no information in the public domain about themselves and their ability to run such a company. In fact, the largest stakeholder in the consortium has been sanctioned by the National Company Law Tribunal (NCLT) and it is not clear whether it has fully met the eligibility criteria laid down by the government for bidders.
This is not the first time the Narendra Modi government’s sale of government assets to private companies has raised questions about the new owners. In January, the government was forced to put on hold the sale of Central Electronics Limited after doubts were raised about the winning bidder’s financial track record, the cases pending against it in the NCLT and questionable inter-connections among bidders.
Pawan Hans: A national asset
Pawan Hans was founded in 1985 as a joint venture of the Ministry of Civil Aviation and the public sector Oil and Natural Gas Corporation (ONGC). It is the largest helicopter service provider in the country.
In the past three years, Pawan Hans has been registering losses. In FY18-19, it recorded its worst loss of around Rs 70 crore, which has improved to losses of around Rs 18.5 crore in FY19-20 and around Rs 17.6 crore in FY20-21. This came after a sharp profit that it registered in FY16-17 of Rs 254 crore. That year, the government converted the debt of Rs 130 crore that Pawan Hans owed it into equity and wrote off interest dues of around Rs 339 crore – which is what had resulted in the high profit. In the year that preceded it, that is FY15-16, the company had made a profit of around Rs 57 crore. In the year that followed, that is FY17-18, the company made a profit of around Rs 20 crore. The chart and table below track its revenue and profits since 2016.
Financial Performance of Pawan Hans Limited (all figures in Rs crore)
Financial year FY16 FY17 FY18 FY19 FY20 FY21 Revenue 491.67 507.73 458.02 414 376.75 401.71 Profit 57.17 254.09 20.23 -70.49 -18.53 -17.61
In the information memorandum seeking expressions of interest in Pawan Hans issued by SBI Capital Markets (that had been appointed transaction adviser for the disinvestment process) in December 2020, various explanations are provided for why the company’s revenue started to fall in 2016, leading to the company going into losses two years later (notwithstanding the extraordinary gains owing to the debt write off and debt to equity conversion by the government in 2017). The document said that three accidents in 2015 accounted for a drop in revenue from operations from 2016 onwards. Due to these accidents, the insurance cost of the helicopters had also risen, the document added. Revenue further declined in 2020 due to the ageing of helicopters. As of March 31, 2020, the document said, five helicopters are not operational as they could not be repaired due to spare parts not being available, and one helicopter had been dispatched to Russia for an overhaul. Revenue from operations had further been impacted, the document said, due to the decline in revenue from consultancy services towards development of heliports.
Despite these fluctuations in its financial performance however, Pawan Hans is a national asset. Its fleet of 43 helicopters (of which 37 are currently operational) serves the offshore operations of oil and gas companies and provides transportation in the Andaman & Nicobar Islands and Lakshadweep. It connects remote and inaccessible parts of the country, including areas of north-east India, Jammu & Kashmir and Uttarakhand, for tourists and VIPs as well as for government personnel.
Pawan Hans also provides its helicopters for search and rescue operations during natural calamities, carries personnel and material for the Border Security Force, the Border Roads Organisation, supports the Power Grid Corporation, and helps in the surveillance of pipelines of not just ONGC, but GAIL and Oil India Limited as well. Pawan Hans helicopters have been deployed by the security forces and have been chartered for a variety of purposes by private persons and government bodies.
Will the Star9 Mobility consortium be able to handle this diverse range of activities? Let us look at the record and capabilities of its three constituent companies.
Maharaja Aviation Private Limited, operator with three choppers
Maharaja Aviation was incorporated on October 8, 2008 in Indore. Its directors are Sumit Sawhney and Suchin Sawhney. According to an April 15, 2022 Director-General of Civil Aviation (DGCA) report, this company is “a non-scheduled aircraft operator and operates three small helicopters” – two four-seaters and one three-seater.
Between 2013-14 and 2020-21, the company earned a profit only once, Rs 4.92 lakh in 2019-20. In this period, the highest revenue it earned was Rs 9.13 crore in 2017-18. On March 31, 2021, Maharaja Aviation’s total assets were worth Rs 1.35 crore, and the company’s total borrowing stood at Rs 8.07 crore. Its net worth was negative at minus Rs 7.59 crore.
Maharaja Aviation’s https://www.facebook.com/Maharaja.Robinson/ has publicised some high profile clients who availed of its helicopter services through 2017 and 2018. These include Bollywood actor and Bharatiya Janata Party (BJP) MP
Choppy journey of Big Charter Private Limited
Big Charter was incorporated in Mumbai on December 13, 2014 by a former pilot with the erstwhile Kingfisher Airlines, Captain Sanjay Mandavia. The company’s LinkedIn page states that it is in the business of truck transportation. Mandavia is a founding member of the Flight Simulation Technique Centre, a company that provides flight simulation services to train pilots of various aircraft.
In 2020, Big Charter won a tender floated by the Meghalaya Transport Corporation to operate a direct flight between Shillong and Delhi twice a week. It started the operation under the name ‘flybig’ airlines in December 2020, with a Bombardier Dash 8 Q400 turboprop aircraft leased from SpiceJet. A few months later, for reasons that are not clear, SpiceJet discontinued its aircraft lease contract with Big Charter and the Shillong to Delhi service stopped. An agitated Meghalaya government then served a show-cause notice on the company in December 2021.
After Big Charter failed to resume operations, Mohendro Raspang, an opposition Member of the Legislative Assembly (MLA) asked the state’s transport minister: “Is it prudent to sign an agreement with an operator who has no aircraft or shouldn’t we look at options where we sign an agreement with an operator who has at least one or two aircraft of its own?”
Dasakhiatbha Lamare, Meghalaya’s transport minister, replied that ‘flybig’ has “promised us that it will avail an aircraft…(a) Bombardier Q400.” He added: “Since this was the first experience, it was a lesson for us. Let us see by the end of this month if the airline can provide us the services we need or else we will take another step.”
By the middle of 2021, Big Charter was reported to be in financial distress and was looking for investors with deep pockets. It started defaulting on payment of salaries and taxes. Many employees, including its chief executive officer (CEO) and chief financial officer (CFO), left the company. At that juncture, it was operating its two ATR aircraft to 13 destinations on 16 daily flights.
In its annual returns for 2020-21, the company mentioned three principal business activities that generated the following proportions of its income: passenger and charter services (24.85%), fees for training students (18.35%) and foreign commission (56.8%). In 2019-20, for the first time, the company booked a profit of a little over Rs 1 lakh. This figure jumped to Rs 98.45 lakh in the following financial year. Big Charter had a net worth of approximately Rs 9.5 crore on March 31, 2021.
On March 26, 2022, the Ministry of Civil Aviation
@flybigairlines signed a Letter of Intent to acquire up to 10 Twin Otter Series 400 Aircrafts from @dehavillandAIR of Canada to assist in serving small & remote communities which previously didn’t have access to air travel. (1/2)#WingsIndia2022#AzadiKaAmritMahotsav pic.twitter.com/FOvjfjFGaW
— MoCA_GoI (@MoCA_GoI)
Ten Twitter handles were tagged by the Ministry of Civil Aviation (MoCA) – those of Union Minister of Civil Aviation Jyotiraditya Scindia; the Federation of Indian Chambers of Commerce and Industry of India (FICCI); Usha Pandhee and Amber Dubey, both joint secretaries in the MoCA; the main and ministerial offices of the Press Information Bureau; General V.K. Singh, Minister of State, Civil Aviation; Amrit Mahotsav (a government initiative to celebrate 75 years of India’s independence); Wings India 2022 (a three-day event on civil aviation that was organised by the Union government in Hyderabad during 24-27 March) and Pawan Hans Ltd.
Why did MoCA chose to tweet information about a small regional airline with two leased aircraft signing a letter of intent to procure 10 small aircraft? Why was Pawan Hans tagged? How was the public sector company connected to the deal involving Big Charter’s ‘flybig’ given the former is a helicopter company and has nothing to with airplanes? Was the tweet an indication of what was to come?
These questions are significant because the transfer of a controlling interest in Pawan Hans to the consortium that included the owner of ‘flybig’ airlines – Big Charter – was announced a whole month later, on April 29.
The registration details of ‘flybig’ published by DGCA states that as on April 15, 2022, it operated two leased ATR 72-212A type aircraft, each with 72 seats. The airline had added a Q400 aircraft on a wet-lease from Ethiopian Airlines with crew to its fleet on April 28. (In a wet-lease, the organisation that owns the aircraft provides crew members along with the leased aircraft to another organisation and is also responsible for maintenance of the aircraft and insurance cover.)
Also read: Air India Rolls Out Red Carpet for Aviation Secy, Wife, Upgrades Tickets to Business Class for Cheap
Little known of Cayman-based Almas Global Opportunity Fund SPC
The third member of the consortium that constitutes Star9 Mobility, Almas Global Opportunity Fund SPC (AGOF), is an entity registered in the Caribbean tax haven, the Cayman Islands. AGOF’s website discloses little about the company but mentions a wide array of sectors in which it invests.
This fund, as it claims, was incorporated in November 2017. Its minimalist website states that the “primary objective of the Fund is to provide its shareholders with maximum short to medium term capital appreciation through a combination of debt and equity investment. Fund many sub-funds that diversify over different strategies like Trade Finance, Real Estate, Fixed Income and Renewable Energy.”
The website of the parent company of the fund, Almas Capital Limited, adds: “The Fund is in Segregated Portfolio Company (SPC) structure, and invests in companies through Debt or Equity.”
Almas Capital introduces itself as a Dubai-based “financial services company” and like the website of the fund, the information that has been publicly provided is sparse. Unlike several other similar corporate entities, information about the people behind the company including their educational and professional background is absent. The Almas Capital website does not have an address and names no employee or contact person but lists a generic email address and a United Arab Emirates (UAE) phone number.
The section of the website titled “track record” is reproduced below.
The information given indicates that the company has not yet invested or raised funds.
Amardeep Sharma. Photo: LinkedInIn December 2021, several publications in India reported that a start-up named Jupitice, an AI/ML (artificial intelligence/machine learning) and blockchain-based technology platform, had announced that Almas Capital (also known as Almas Caps) had raised $4 million for the start-up. This is not mentioned on the website of Almas Capital. These news reports mention Amardeep Sharma as the managing director of Almas Capital.
According to his LinkedIn profile, Sharma was the managing director of Almas Capital between March 2017 and November 2020. Subsequently, he has been the senior executive officer and member of the board of directors of Greenback Capital Limited.
Who then are the people behind Almas Capital, which raised $4 million for Jupitice and leads the Star9 Mobility consortium (by virtue of owning the single largest stake in it) that acquired control over Pawan Hans?
The answer lies in the website of another company, Greenback Capital. Unlike Almas Capital, this website provides details about the company’s core team and other employees. Amardeep Sharma is the chairman and member of the company’s board of directors. And, it turns out, on its website Greenback Capital claims to be the company that raised funds for Jupitice.
Greenback Capital has a regulated licence and is registered with the Dubai International Financial Centre (DIFC). It was incorporated on 28 October 2020 and has an office in the DIFC. Amardeep Sharma, Charudutta Joshi and A**** Mahendra Mehta are its directors.
The firm’s website doesn’t mention Mehta anywhere but lists two more directors, Ramen Ray Mandal and Habeeb Ahmed. Mandal is a director in Star9 Mobility. Mehta is one of the directors in Parmes Diamonds Exports Private Limited, a Surat-based diamond export firm.
NCLT verdict against Almas Global Opportunity Fund
On April 22, 2022, the Kolkata bench of the National Company Law Tribunal (NCLT) passed an order in a case that involved Almas Global.
The case concerned the acquisition of EMC Limited, a Kolkata-based company that provides systems used in power transmission and distribution equipment, by Almas Global, through the Corporate Insolvency Resolution Process. Almas Global Opportunity Fund had successfully bid to acquire EMC Limited after the company had entered the insolvency resolution process in 2019. According to the case before the NCLT that had been brought by the resolution professional, Almas Global had failed to pay around Rs 568 crore to EMC’s creditors under the resolution plan that it had proposed, and which had been accepted. Further, the petitioner to the NCLT alleged that Almas Global was repeatedly making a variety of excuses for failing to pay and discharge its duties towards implementing the resolution plan.
The NCLT’s order flayed the conduct of Almas Global and accused it of “wilful contravention of the approved resolution plan”. The tribunal ordered that two performance bank guarantees amounting to Rs 30 crore submitted by Almas Global be forfeited, and that the company and its officers be proceeded against. Specifically, the NCLT called for a copy of its order in the case to be sent to the secretary, Ministry of Corporate Affairs and to the Insolvency and Bankruptcy Board of India, the agency authorised to initiate a complaint against Almas Global and its officers.
The NCLT’s order noted multiple violations by the company and its authorised representative, Amardeep Sharma. It said that Sharma “tried to mislead the court” and that Almas Global “has taken the entire process for a ride.”
Interestingly, in one of his affidavits filed before the tribunal, Sharma claimed that he couldn’t disclose commercial information related to the funding of the resolution plan due to the confidentiality laws prevailing in the Cayman Islands, a tax haven. The NCLT described this move as “impudent” and said that “it seems to assume that the judicial authorities in India cannot understand anything beyond the limited territorial jurisdiction of India.” “It is so brazen that it is almost laughable, if not for the solemnity of these proceedings,” the tribunal continued about the affidavit.
The NCLT said that its order should be sent to the secretary, Ministry of Corporate Affairs. The secretary reports to the minister – in this case, Union finance minister Nirmala Sitharaman (who is also in charge of the Ministry of Corporate Affairs) and a member of the Cabinet Committee on Economic Affairs (CCEA) which approved the disinvestment plan of Pawan Hans Limited on April 29.
Was Sitharaman aware of the order by the adjudicating authority asking the ministry to take legal action against Almas Global Opportunity Fund and its representative Amardeep Sharma? Did she share this information with her ministerial colleagues in the CCEA? Even after knowing these facts, what prompted the government to go ahead with the offer submitted by Star9 Mobility? Did the consortium disclose the names and other details of the “real” or “beneficiary” owners of Almas Global and the way it would raise funds for the acquisition to the CCEA?
Eligibility criteria fully met?
The story does not end here. “The Preliminary Information Memorandum for Inviting Expression of Interest for Strategic Disinvestment of Pawan Hans Limited by Government of India,” published on December 8, 2020, explains the Eligibility Criteria for the Interested Bidders (IB) from page 47 onwards in the document.
It is unclear if Star9 Mobility meets two relevant eligibility criteria. The first criterion is that Almas Global must be registered with the Securities and Exchange Board of India (SEBI), the regulator of the country’s financial markets, as an Alternative Investment Fund (AIF) to make it eligible to invest in India. However, the names of Almas Capital Limited, Almas Global Opportunity Fund and Greenback Capital are not listed in SEBI’s published list of Registered AIFs.
Then comes the issue of net worth. The financial criteria for eligibility state that a bidder for a public sector company (including Pawan Hans) must have a minimum net worth of Rs 300 crore, taken as a sum of the net worth of all the members of the consortium. For a consortium comprising both Air Transit Service Operators (ATSOs) and non-ATSOs, the criteria state the following: ATSOs can hold up to 51% equity stake in a consortium and if their net worth is negative, it will be considered as nil for the purposes of the bid, and the non-ATSO entity/entities that hold/s the rest in the consortium must make up the minimum net worth requirement of Rs 300 crore.
As the bids had to be submitted before the closure of the financial year, that is March 31, 2022, it is safe to assume that the net worth of these three companies would have been evaluated based on their fully audited financial results of the previous financial year, 2020-21. According to these criteria, Maharaja Aviation had a negative net worth of Rs 7.59 crore. Big Charter’s net worth, on March 31, 2021, was around Rs 9.5 crore. These two companies are ATSOs. Thus, if the consortium had to have a total net worth of Rs 300 crore, the difference would have to be made up by Almas.
No information is publicly available on AGOF’s net worth. The NCLT order clearly stated that Almas Global Opportunity Fund could not raise enough money to pay the dues to EMC’s creditors of around Rs 568 crore for nearly one and a half years. In such a scenario, it is the responsibility of the CCEA to clarify as to how it concluded that Star9 Mobility, including Almas Global, had the required net worth of Rs 300 crore to be a bidder for Pawan Hans? If Almas Capital and Greenback are the same, the Dubai International Financial Centre clearly mentions that Greenback has a share capital of just $1 million that is held by Amardeep Sharma.
Unnamed government sources ‘clarify’
In the days following the announcement of the sale, with the Congress party questioning the government on the disinvestment process, a clarification has appeared in a section of the media quoting anonymous government officials.
In an article published on May 6, The Hindu quoted an unnamed “senior official” of the Department of Investment and Public Asset Management (DIPAM) as claiming: “One of the distorted arguments we have heard is that the successful entity has a net worth of ₹1 lakh instead of the ₹300-crore net worth we had stipulated…This is a misinterpretation of facts at best.”
The news report quoted the unnamed DIPAM official as adding: “After the preliminary information memorandum was issued, the three partners of the winning consortium had submitted proof of a combined net worth of ₹699.49 crore. This was updated again at the time we called for bids to ₹710.08 crore…At both stages, all three submitted their updated financial statements for the past 12 months.”
An article in India Today, also published on May 6, contains an identical quote attributed to a “senior DIPAM source” and includes what appears to be a screenshot from an unidentified document, which is a table listing the members of the Star9 Mobility consortium, their stake in the consortium, their status as ATSOs or non-ATSOs and their net worth. Maharaja Aviation and Big Charter are both shown as ATSOs with nil net worth, and Almas Global, the non-ATSO, is shown as having a net worth of Rs 691 crore.
If these claims are true, it would mean that Almas Global turned over financial information to the government as a part of its bid that it refused to hand over to the NCLT in the case regarding EMC Limited, wherein it had cited the confidentiality laws of Cayman Islands. Why this discrepancy?
If documents are available with the government proving Almas Global’s net worth, shouldn’t these be available for public scrutiny, by a constitutional authority such as the Comptroller and Auditor General?
Who are the real players behind this sale of a national asset? And who are the actual beneficiaries?
We emailed questionnaires to the following 11 individuals in the afternoon of May 9: Union minister of civil aviation Jyotiraditya Scindia; secretary, civil aviation, Pradeep Singh Kharola; Union minister of finance and corporate affairs Nirmala Sitharaman; minister of state for finance and corporate affairs Pankaj Choudhary; finance secretary Dr T.V. Somanathan; secretary, corporate affairs, Rajesh Verma; minister for road transport and highways Nitin Gadkari (who is also a member of the Cabinet Committee on Economic Affairs); secretary, road transport and highways Giridhar Aramane; Captain Sanjay Mandavia of Big Charter; Sumit Sawhney of Maharaja Aviation; and Amardeep Sharma of Greenback Capital.
Till the time of publication, no response had been received from any of the 11 persons named above. The article will be updated as and when their responses are received.
The authors are independent journalists.
Last edited by Cyclic Hotline; 16th May 2022 at 11:14. Reason: add source
Thread Starter
Looks like business as usual in this privatization debacle.
https://www.outlookindia.com/busines...me-news-197394
Astha Oriel
UPDATED: 19 MAY 2022 8:17 AM
It was a fleeting moment in April this year when the Indian government was able to finalize the sale of its 51 per cent stake in Pawan Hans, after the three failed attempts in the past six years. Pawan Hans is a joint venture by the government of India and the state-owned ONGC which holds a 49 per cent stake in the company. The government had approved the sale of Pawan Hans to Star9 Mobility, a three-way consortium of Cayman Island-based Almas Global Opportunity Fund—a subsidiary of Dubai-based Almas Capital, Mumbai-based Big Charter Private Limited, and Delhi-based Maharaja Aviation Private Limited at a cost of Rs 211 crore, which is above the government’s quoted price of Rs 119 crore. However, an order by the National Company Law Tribunal (NCLT) alleging Almas Global Opportunity Fund of financial discrepancies in a previous bid has forced the government to halt the sale of the helicopter company.
NCLT and EMC Case
The NCLT on April 20 this year, passed an order for action against Almas Global Opportunity Fund in the insolvency case of Kolkata-based EMC Limited—a power transmission and distribution equipment company. According to reports, in 2018, EMC Limited filed for insolvency worth Rs 6,500 crore. In 2019, Almas Global emerged as the successful bidder of the company, after which a committee of creditors (CoC) led by the State Bank of India approved Almas Global to pay Rs 568 crore to the creditors of EMC Limited as part of the proposed resolution plan. However, Almas Group only paid Rs 30 crore as the bank guarantee, after which the CoC moved NCLT against Almas Global for non-repayment of the resolution amount.
As per Section 74 (3) of the insolvency code, a successful bidder is liable to a maximum of five years of imprisonment with a penalty of up to Rs 1 crore, if it fails on the repayment of the resolution amount.
Notably, the guidelines by the Department of Investment and Public Asset Management (DIPAM) also disqualify any group or entity, whose member company or director is facing a conviction in the court. Almas Group holds a 49 per cent stake in the six-month-old Star9 Mobility, followed by Maharaja Aviation which holds a 25 per cent stake, and Big Charter Private Limited, which holds a 26 per cent stake in Star9 Mobility.
However, the government announced Star9 Mobility as the successful bidder of Pawan Hans, nine days after NCLT passed its order in April.
Financial Crunch Of Big Charter and Maharaja Aviation
However, the issues do not pertain to the NCLT order against Almas Group. According to an investigation by a leading media organization, the past aviation activities of Maharaja Aviation and Big Charter—both DGCA-affiliated airline operators, are also in question. The report said that Maharaja Aviation which has a fleet of only three helicopters, had a profitable business only once between 2013 and 2021, since its inception in 2008. In March 2021, the assets of Maharaja Aviation were valued only at Rs 1.35 crore and the company’s borrowings stood at Rs 8.07 crore, thus making brows raise on the ability of the loss-making airline to operate a veteran like Pawan Hans.
Meanwhile, Big Charter Limited, which operates local airline Flybig, won a tender floated by the Meghalayan Government in 2020. The company which was founded in December 2014, by aviation veteran Captain Sanjay Madavia, had leased out a Bombardier Dash 8 q400 turbopop from SpiceJet for operations between Shillong and Delhi. However, as per the report, months later, SpiceJet discontinued its leasing contract with Big Charter for reasons unknown, which caused a political uproar with many leaders questioning the government’s contract with Big Charter, which then had no aircraft. Over the next few months following SpiceJet’s leasing incident, the airline faced a huge financial crunch with many of its employees, including the top management leaving the company. According to the report, the company reported a profit of little over Rs 1 lakh in FY2019-2020, which jumped to Rs 98 lakh in FY2020-21.
The loss-making company revived itself by further adding Twin Otter Series 400 aircraft from Canada’s de Havilland Air to its fleet according to the Ministry of Civil Aviation. Experts have raised questions about the onboarding process of such a large fleet by a company, which was deep neck into losses a year ago.
Apart from this, the political opposition has also raised questions about the anonymity of the other two bidders which the government refuses to reveal as well as the government’s decision not to merge Pawan Hans with ONGC.
A Disgruntled History Of Pawan Hans
Pawan Hans was incorporated in 1985, under the name Helicopter Corporation Of India. In 1987, it was renamed Pawan Hans. Pawan Hans, which has the largest fleet in Southeast Asia, with 42 helicopters, has most of its helicopters over 20 years old. Notably, five of its Dauphin N Helicopters, have been grounded for a long time, thus bringing down its operational fleet to 37 helicopters according to reports.
Owing to its age-old helicopters, the repair and maintenance of the fleet have become expensive. As a result, the government first decided to sell its stake in Pawan Hans in 2016. However, all the three previous attempts in 2017, 2018, and 2019 failed due to the unavailability of a suitable buyer, despite the government inviting expressions of interest.
Moreover, the company has not performed well over the past few years and has been incurring heavy losses beginning FY2019 worth Rs 70 crore. In FY2020, the company incurred a loss of 18.5 crores, whereas, in FY2021, it incurred a loss of Rs 17.6 crore. The sale of Pawan Hans is part of the government’s divestment plan.
https://www.outlookindia.com/busines...me-news-197394
What Led To The Brakes On Pawan Hans Sale For Fourth Time
Pawan Hans is a joint venture by the government of India and the state-owned ONGC which holds a 49 per cent stake in the companyAstha Oriel
UPDATED: 19 MAY 2022 8:17 AMIt was a fleeting moment in April this year when the Indian government was able to finalize the sale of its 51 per cent stake in Pawan Hans, after the three failed attempts in the past six years. Pawan Hans is a joint venture by the government of India and the state-owned ONGC which holds a 49 per cent stake in the company. The government had approved the sale of Pawan Hans to Star9 Mobility, a three-way consortium of Cayman Island-based Almas Global Opportunity Fund—a subsidiary of Dubai-based Almas Capital, Mumbai-based Big Charter Private Limited, and Delhi-based Maharaja Aviation Private Limited at a cost of Rs 211 crore, which is above the government’s quoted price of Rs 119 crore. However, an order by the National Company Law Tribunal (NCLT) alleging Almas Global Opportunity Fund of financial discrepancies in a previous bid has forced the government to halt the sale of the helicopter company.
NCLT and EMC Case
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The NCLT on April 20 this year, passed an order for action against Almas Global Opportunity Fund in the insolvency case of Kolkata-based EMC Limited—a power transmission and distribution equipment company. According to reports, in 2018, EMC Limited filed for insolvency worth Rs 6,500 crore. In 2019, Almas Global emerged as the successful bidder of the company, after which a committee of creditors (CoC) led by the State Bank of India approved Almas Global to pay Rs 568 crore to the creditors of EMC Limited as part of the proposed resolution plan. However, Almas Group only paid Rs 30 crore as the bank guarantee, after which the CoC moved NCLT against Almas Global for non-repayment of the resolution amount.
As per Section 74 (3) of the insolvency code, a successful bidder is liable to a maximum of five years of imprisonment with a penalty of up to Rs 1 crore, if it fails on the repayment of the resolution amount.
Notably, the guidelines by the Department of Investment and Public Asset Management (DIPAM) also disqualify any group or entity, whose member company or director is facing a conviction in the court. Almas Group holds a 49 per cent stake in the six-month-old Star9 Mobility, followed by Maharaja Aviation which holds a 25 per cent stake, and Big Charter Private Limited, which holds a 26 per cent stake in Star9 Mobility.
However, the government announced Star9 Mobility as the successful bidder of Pawan Hans, nine days after NCLT passed its order in April.
Financial Crunch Of Big Charter and Maharaja Aviation
However, the issues do not pertain to the NCLT order against Almas Group. According to an investigation by a leading media organization, the past aviation activities of Maharaja Aviation and Big Charter—both DGCA-affiliated airline operators, are also in question. The report said that Maharaja Aviation which has a fleet of only three helicopters, had a profitable business only once between 2013 and 2021, since its inception in 2008. In March 2021, the assets of Maharaja Aviation were valued only at Rs 1.35 crore and the company’s borrowings stood at Rs 8.07 crore, thus making brows raise on the ability of the loss-making airline to operate a veteran like Pawan Hans.
Meanwhile, Big Charter Limited, which operates local airline Flybig, won a tender floated by the Meghalayan Government in 2020. The company which was founded in December 2014, by aviation veteran Captain Sanjay Madavia, had leased out a Bombardier Dash 8 q400 turbopop from SpiceJet for operations between Shillong and Delhi. However, as per the report, months later, SpiceJet discontinued its leasing contract with Big Charter for reasons unknown, which caused a political uproar with many leaders questioning the government’s contract with Big Charter, which then had no aircraft. Over the next few months following SpiceJet’s leasing incident, the airline faced a huge financial crunch with many of its employees, including the top management leaving the company. According to the report, the company reported a profit of little over Rs 1 lakh in FY2019-2020, which jumped to Rs 98 lakh in FY2020-21.
The loss-making company revived itself by further adding Twin Otter Series 400 aircraft from Canada’s de Havilland Air to its fleet according to the Ministry of Civil Aviation. Experts have raised questions about the onboarding process of such a large fleet by a company, which was deep neck into losses a year ago.
Apart from this, the political opposition has also raised questions about the anonymity of the other two bidders which the government refuses to reveal as well as the government’s decision not to merge Pawan Hans with ONGC.
A Disgruntled History Of Pawan Hans
Pawan Hans was incorporated in 1985, under the name Helicopter Corporation Of India. In 1987, it was renamed Pawan Hans. Pawan Hans, which has the largest fleet in Southeast Asia, with 42 helicopters, has most of its helicopters over 20 years old. Notably, five of its Dauphin N Helicopters, have been grounded for a long time, thus bringing down its operational fleet to 37 helicopters according to reports.
Owing to its age-old helicopters, the repair and maintenance of the fleet have become expensive. As a result, the government first decided to sell its stake in Pawan Hans in 2016. However, all the three previous attempts in 2017, 2018, and 2019 failed due to the unavailability of a suitable buyer, despite the government inviting expressions of interest.
Moreover, the company has not performed well over the past few years and has been incurring heavy losses beginning FY2019 worth Rs 70 crore. In FY2020, the company incurred a loss of 18.5 crores, whereas, in FY2021, it incurred a loss of Rs 17.6 crore. The sale of Pawan Hans is part of the government’s divestment plan.
