Advertisements for Advisors

31^st October, 2001

Dear Sirs,

Sub: Engagement of an Advisor for Disinvestment/Joint Venture Formation in respect of Richardson & Cruddas (1972) Limited (A Government of India Undertaking & a subsidiary of Bharat Yantra Nigam Limited)

Bharat Yantra Nigam Limited (BYN), a Central PSU under the administrative control of Ministry of Heavy Industries & Public Enterprises (Department of Heavy Industry), intends to disinvest up to 74% stake in Richardson & Cruddas (1972) Limited (R&C), one of its Subsidiary Companies, through strategic sale/other means, and proposes to engage the services of an Advisor to advise and manage the disinvestment process successfully.

A brief profile of R&C is enclosed for your ready reference.  Detailed information in respect of BYN and R&C can be accessed on web sites www.byngroup.com and www.richardsoncruddas.com respectively.

The responsibilities of the Advisor would, inter-alia, cover rendering of advice and assisting GOI/BYN in the disinvestment, assessment and valuation, suggesting measures to enhance sale value, preparing a detailed information memorandum, marketing of the offer, inviting and evaluating the bids, assisting during the negotiations with prospective buyers, drawing up the sale/other agreements and advising on post sale matters.  The advisor would be required to make an independent study and advise on restructuring requirements / reorganization of the existing structure including Unitwise demerger/hiving off/subsidiarisation, if any, in order to accelerate the process of disinvestment and to package the deal to make the same attractive to the investors/strategic partners.

If inclined to take up the assignment, please submit your expression of Interest for selection as Advisor, singly or as a consortium, so as to reach us on or before 1700 hours of November 19, 2001 along with the details of your firm/consortium, inter-alia covering the following:

1.      Full particulars of the constitution, ownership and main business activities. In case of consortium bids, the particulars of the coordinating firm having the principal responsibility for the mandate as well as those of other partners.

2.      Unabridged Annual Reports and audited financial accounts for the last three years of all the partners.

3.      Details of the pending litigation and contingent liabilities, if any, that could affect the performance of the bidder under the mandate, as also details of any past conviction and pending litigation against sponsors/partners and any areas of possible conflicts of interest.

The entire process of selection of the Advisor would be done under the aegis of an Inter Ministerial Group (IMG) constituted by the Department of Heavy Industry in the Ministry of Heavy Industries and Public Enterprises, Government of India. The short listed bidders would be required to demonstrate their credentials before the IMG through a presentation (along with ten hard copies of the presentation for the Members) covering the areas/criteria listed below:

• Presence in India, including number of offices, manpower, funds deployed, period etc. and the level of commitment in India.

• Privatisation experience in Public Sector Undertakings.

• Details of similar transaction (Government, Quasi Government and Private Sector, separately) executed/under execution by the bidder in a similar sector/industry. This should cover the role played by the bidder in deal structuring, valuation, transaction marketing, preparation of Information and Sale Memorandum, Shareholders Agreement, etc. and bid evaluation and negotiations.

• Experience in capital market transactions (both equity and debt), in the Government, Quasi Government and Private Sectors, separately, indicating the number of deals  executed and quantum of funds raised.

• Understanding of BYN and its Subsidiary Company - R&C, including a SWOT analysis incorporating key selling points and limitations.

• Proposed methodology of the disinvestments/strategic sale transaction indicating the issues involved including:

i.        Valuation of R&C

ii.     Transaction of structuring

iii.   Marketing Strategy

iv.   Bid evaluation methodology

v.      Tentative time frame

• Details of deal team:

a.      Experience and qualifications

b.      Team members located abroad

c.       Team members located in India

The Presentation will be held at New Delhi; the exact date – which would be after about fifteen days from the last date of submission of Expression of Interest (tentatively on 3.12.2001) – would be confirmed to the bidders who should be prepared for presentations at short notice.

The bidders are required to submit at the time of making the presentation to the IMG, sealed financial bids incorporating the fee chargeable as a percentage of the sale proceeds from the disinvestments, gross of all taxes. The bid shall be unconditional. The Expenditure on account of fees to legal/accounting or any other consultant, if appointed, should not be included in the financial bid. The travel related expenses and all other expenses including those related to due diligence would have to be borne by the Advisor. The financial bid should also indicate a lump sum amount to be charged as drop dead fee, which would be payable if GOI/BYN decides to call off the transaction/assignment for whatsoever reasons.

The offer shall be kept open atleast for a period of 3 months from the date of submission of the bid/Expression of Interest.

The selected bidder shall enter into a Confidentiality Agreement with GOI/BYN in the prescribed format and shall work in close association with  GOI/BYN as well as the IMG and /or the officials of the Department of Heavy Industry.