NEW DELHI : At least six companies, including Tata Motors Ltd, Mahindra and Mahindra Ltd and Ashok Leyland Ltd, are looking to buy a 26% stake in state-run defence equipment maker BEML Ltd, two people aware of the developments said.
Bharat Forge Ltd and Megha Engineering and Infrastructure Ltd may also submit expressions of interest for the government’s stake in BEML, the people said on condition of anonymity.
Companies such as Tata Motors, Mahindra and Ashok Leyland are looking to seek control of BEML as part of their strategy to grow their defence manufacturing businesses and cut dependence on the core commercial vehicle business, which is cyclical in nature.
“For auto companies, BEML is a major competitor in the tenders and would eventually win a lot of them since it’s state controlled. Hence, it makes sense for these companies to acquire the heavy-vehicle manufacturing company,” said a senior executive from one of the firms cited above, requesting anonymity.
The government, which owns 54% in BEML, invited expressions of interest for the stake sale in the defence equipment maker, along with the transfer of management control, on 4 January. The department of investment and public asset (Dipam) initially set 1 March as the deadline for submission of interest but later extended it to 22 March.
SBI Capital Markets Ltd is advising the government on the sale process.
“After the EoIs (expressions of interest have been received, SBI Capital Markets will intimate the shortlisted bidders of the next stage,” said one of the two people cited above.
News Source: Mint