The Hindu : National : "Ready to face probe into Centaur disinvestments"

Online edition of India's National Newspaper
Friday, May 06, 2005

National

National

"Ready to face probe into Centaur disinvestments"

Special Correspondent

"I had a meeting with bankers to see the deal through"

— Photo: AP

DENIAL: The former Disinvestment Minister and senior Bharatiya Janta Party leader, Arun Shourie, at a press conference in New Delhi on Thursday.

NEW DELHI: Former Disinvestment Minister and Bharatiya Janata Party leader Arun Shourie on Thursday denied that he influenced public sector banks to lend money to Ajit Kerkar of Tulip International to help him come up with Rs. 153 crores after he had won the bid for the Juhu Centaur Hotel in Mumbai.

It was sold when Mr. Shourie was Minister in the Vajpayee Government.

However, he admitted that he had a meeting with bankers, potential lenders to Tulip, to see the deal through.

Addressing a press conference here, Mr. Shourie said he was willing to face any inquiry by the Central Bureau of Investigation, the Central Vigilance Commission or any other agency.

He would want the inquiry to be "open". He charged the Government with being "keen to dig out some dirt" on the National Democratic Alliance regime.

While avoiding any explanation for the evaluation of the property being brought down from Rs. 246 crores to Rs. 101.60 crores fixed as the reserve price when bids were invited, Mr. Shourie said the adviser's report on evaluation should be made public.

He justified the difference in the evaluation figures, saying that in the case of Videsh Sanchar Nigam Limited, the share price today was lower than what the Tatas paid when they bought the controlling stake in 2002. "These are all commercial decisions."

Mr. Shourie was asked how Mr. Kerkar, the "seller" of the property as a member of the Air India board which owned the property, could become the "buyer" as the owner of Tulip with the bulk of the money provided by public sector banks.

(On Wednesday Finance Minister P. Chidambaram told the Lok Sabha that Mr. Kerkar was a member of the sub-committee of the Air India board to advise it on disinvestment. After a consultant was appointed on its recommendation, Mr. Kerkar was not on the board when it was reconstituted the next day).

Mr. Shourie said that after a secret reserve price was fixed at Rs. 101.6 crores, bids were invited. Twenty parties expressed interest, three were disqualified and 16 did not pursue with the expression of intent letters.

Finally there was only one bidder — Mr. Kerkar of Tulip — and his bid was accepted, as it was "fifty per cent higher than the reserved price." Mr. Shourie admitted that Mr. Kerkar did not come up with the money on time and was given extension more than once. He had a meeting with the bankers in his office to ensure that bank guarantees for Rs. 153 crores would be forthcoming to enable completion of the transaction.

Printer friendly page
Send this article to Friends by E-Mail

National