The Finance Ministry’s Department of Investment and Public Asset Management (DIPAM) has invited fresh bids to appoint merchant bankers and transaction advisors to manage the government’s stake sale in Rashtriya Chemicals and Fertilizers (RCF) and National Fertilizers Ltd (NFL). This move signals a renewed push to revive the long-pending disinvestment of the two state-run fertiliser firms — a plan that has been awaiting execution for more than eight years despite Cabinet approval.
A senior government official told Moneycontrol: “The plan to offload stakes in RCF and NFL has been pending for eight years. DIPAM has to do it as it is the decision of the Cabinet.”
The Cabinet had earlier approved disinvestment of a 20% stake in NFL and a 10% stake in RCF, which together are estimated to fetch around ₹1,200 crore at current valuations.
Previous tenure ends, fresh bids invited
According to sources, the tenure of previously appointed merchant bankers and transaction advisors expired without extension, prompting the ministry to seek new bids.
“DIPAM has invited the appointment of new merchant bankers and transaction advisors for offloading stake in RCF and NFL. Once appointed during this fiscal, if the government wants, the OFS (Offer for Sale) in the two fertiliser PSUs can be launched within a month, depending on market conditions,” a person aware of the matter said.
Previously, Kotak Investment Banking and IDBI Capital were appointed as transaction advisors for RCF, while BOB Capital Markets Ltd and IDBI Capital were on board for NFL.
Market conditions key to timing
While DIPAM’s latest move clears the path for a potential OFS, the timing of the actual stake sale will hinge on investor sentiment and broader market conditions. Unfavourable market dynamics and tepid investor appetite have kept the divestment plan on hold despite approvals in place.
The government is expected to finalise the new set of merchant bankers and transaction advisors soon, potentially paving the way for the long-awaited stake sale in these two fertiliser PSUs.
