NEW DELHI: The government has further tightened conditions for the appointment of merchant bankers and brokers for the sale of its stake in blue-chip companies held through the Specified Undertaking of Unit Trust of India (SUUTI).
According to an updated request for proposal, merchant bankers selected will have to submit a list of institutional and other major investors – domestic and international — they will approach for proposed stake sale in Group A companies, including Axis BankBSE -0.39 %, Larsen & Toubro, and ITC.
Earlier, the government had relaxed selection norms, noting that merchant bankers need not inform SUUTI about conflict-of-interest situations during selection stage.
“A merchant banker who is in the conflict in respect of a particular transaction shall be considered for a subsequent transaction on cessation of the conflict situation, in accordance with the original ranking. This process would be followed for each transaction separately,” the RFP had said.
The government then held a fresh pre-bid meeting on August 27 to clarify their issues and now they will have to submit their bids by September 6.
Merchant bankers will need to submit a plan of action, which will be evaluated by SUUTI, and may be required to make certain alterations and resubmit, the revised RFP noted.
In addition, bankers will also present a detailed strategy for reaching out to retail investors to create awareness about their participation in stake sale.
