PRELIMINARY INFORMATION MEMORANDUM (PIM)

 

BRAITHWAITE & CO. LTD.

 TABLE OF CONTENTS

 

	PAGE NO.
DISCLAIMER	3
SUBMISSION OF EXPRESSION OF INTEREST	5
BRIEF PROFILE OF BCL	12
ANNEXURES	22

DISCLAIMER

 

1.      UTI Bank Limited (“UTIBL” or the Advisor) in   association  with  Deloitte Touche & Tohmatsu India Pvt. Ltd., have been retained  as  Advisor by Bharat Bhari Udyog Nigam Limited (BBUNL) for   locating  a Strategic Joint Venture Partner for  its 100% subsidiary, Braithwaite & Co. Limited (“BCL” or “the Company”) by disinvestment of 60% of the stake of BBUNL.

 

2.      The sole purpose of this Preliminary Information Memorandum (PIM) is  to assist the party interested in being the ‘ Strategic Joint Venture Partner’ to participate in the disinventment process. 

 

3.      This  PIM   does  not  constitute  an  offer  or  invitation or solicitation of an offer, to subscribe to or purchase BBUNL’s stake in BCL.

 

4.      This document  is    not intended to form the basis of any investment decision and accordingly, interested parties are advised to carry out their own due diligence, investigations and analysis of any information contained or referred to herein or made available at any stage in the disinvestment process and satisfy about the authenticity of the same. This PIM has been delivered to interested parties for information purposes only and upon the express understanding that such parties will use it only for the purpose set forth above.

 

5.      While this document has been prepared in good faith, no representation or warranty, express or implied, is or will be made, and no responsibility or liability will be accepted by BCL, BBUNL, Advisor and its associate, or the Government of India (GOI) or any of their employees, advisors or agents as to or in relation to the accuracy or completeness of this document or any other oral or written information made available to any interested recipient or its advisors at any time during the disinvestment process and any liability thereof is hereby expressly disclaimed.  This PIM may contain / include certain estimates, projections, statements, targets and forecasts with respect to the Company. These are based on the various assumptions made by the management, employees of the Company and BBUNL and/or Advisor or its associate, which, as well as the information on which they are based may or may not be accurate. The opinions in this memorandum have been expressed in good faith. Neither of the Company, BBUNL or Advisor or its associate, management or employees of the Company, make any representations and / or warranty in respect of, and no reliance should be placed on any estimates, projections, statements, targets and forecasts or the assumptions on which they may be based. Any liability of whatsoever in nature, is accordingly expressly declined even if any loss or damage is caused by any act or omission on part of the aforesaid information or data, whether negligent or otherwise.

 

6.      Neither this document nor anything contained herein shall form a basis of any contract or commitment whatsoever. Any prospective purchaser will be required to acknowledge in the purchase contract that he has not relied on or been induced to enter such agreements by any representation or warranty, save as expressly set out in such an agreement.

 

 

7.      Any information contained in this document, will be superceded by any later written information on the same subject made available to the recipient by or on behalf of BCL, BBUNL or the Advisor. BCL, BBUNL and Advisor undertake no obligation to provide the recipient with any additional information or update this document and reserve the right, at any time and without notice, to change or modify the procedure or process for disinvestment, terminate the due diligence or negotiations or any part of or the entire disinvestment process prior to signing of any binding share purchase agreement.

 

8.      This document has not been filed, registered or approved in any jurisdiction. Recipients of this document, particularly in jurisdiction outside India, should inform themselves of and observe any applicable legal requirements.

PART I

 

SUBMISSION OF EXPRESSION OF INTEREST

 

1.         INTRODUCTION

 

1.1              Braithwaite & Co. Limited (“BCL” or “the Company”) is a 100% subsidiary of Bharat Bhari Udyog Nigam Ltd.(BBUNL) is a Government Company under the administrative jurisdiction of the Department of Heavy Industry, Ministry of Heavy Industry and Public Enterprises, Government of India.

 

1.2              BCL is one of the largest Wagon manufacturers in India with an installed capacity of 4350 Four Wheeler Units (FWU). It has infrastructure for the manufacture of Tank/Special Wagons and Components including a dedicated Steel Foundry. Two of its manufacturing units and its registered office are located at Kolkata and their third manufacturing unit at Bhadreawar, Hooghly, in the state of West Bengal.

 

1.3              The company was incorporated in the state of West Bengal as Braithwaite & Co. (India) Ltd., on February 28^th, 1930 with Clive Works at Hide Road, Kolkata as its Registered Office.

 

1.4              In the year 1960 Angus Works located at Bhadreswar, Dist. Hoogly in the state of West Bengal belonging to Angus Engineering Co. Ltd., was taken over by the company for manufacture of wagon and machinery components, EOT Cranes, Foundry Products & Blast Furnace Equipments.

 

1.5              The management of the company was taken over on 6^th March, 1971 by the Govt. of India under the Industries Development & Regulation Act and was subsequently nationalised and incorporated as a Govt. company w.e.f. 1.12.1976.

 

1.6              The project division at Kolkata was formed in 1978 to handle turn-key projects for Coal Handling units, Steel Plant units etc.

 

1.7              The company became a wholly owned subsidiary of BBUNL upon its formation in September, 1986. In 1987, Victoria Works, a unit of Braithwaite, Burn & Jessop Construction Co. Ltd., (BBJ) was taken over by BCL for making Barrel type Wagons and Structurals. The company was declared as a Sick Industrial Company under the provision of the Sick Industrial Companies (Spl. Provisions) Act, 1985 and was referred to BIFR in 1992.

 

1.8              As a part of its disinvestment programme, BBUNL intends to disinvest 60% equity in BCL to a Strategic Partner along with transfer of management control.

 

1.9              UTI Bank Limited in association with Deloitte Touche and Tohmatsu India Pvt. Ltd., have been retained as Advisor to BBUNL for the proposed disinvestment process and matters relating thereto.

 

2.         ADVERTISEMENT INVITING EOI

 

2.1              An advertisement has been issued in Business Standard, The Economic Times and The Financial Express (all editions) on 23^rd December, 2002 inviting interested parties to submit their ‘Expression of Interest’ (EoI) to participate in the disinvestment process, a copy of which is enclosed as Annexure I .

 

3.                  EXPRESSION OF INTEREST

 

3.1              This section describes the outlines of participating in the disinvestment process and the requirements relating to information to be provided by interested parties, when submitting their Expression of Interest (EOI).

 

4.         ELIGIBILITY / PRE QUALIFICATION CRITERIA

 

4.1              The interested party(ies) must have ;

 

(i)                  Positive Networth

(ii)                Annual turnover of Rs.750 million and above as per the latest audited accounts.

 

4.2              For a consortium bid, all members of the consortium should meet the above mentioned eligibility criteria 1.1(i) and the latest combined audited turnover of the constituent entities of the consortium should meet the above mentioned eligibility criteria 1.1(ii), out of which the leader of the consortium should have atleast 51% turnover.

 

4.3              Where the financial statement is expressed in currency other than Indian Rupee, the eligible amount as described above shall be computed by taking the equivalent US dollars at the exchange rates (as stipulated by Foreign Exchange Dealers Association of India) prevailing on the date(s) of such financial statement.

 

4.4              Government is considering formulation of a policy for management buy-outs. This also would be applicable, as and when announced, to any EoIs received in response to this advertisement for management buy-out. It may, however, be clarified that the process of disinvestment would not be delayed in case the policy announcement in this regard is delayed.

 

4.5              Definition of Networth :

 

Networth will be assumed as per definition u/s. 3(1)(ga) of The Sick Industrial Companies (Special Provision) Act, 1985, as amended upto date.

 

4.6              The PIM along with its enclosures does not constitute a commitment on the part of the GOI or BBUNL or Advisor, whether in respect of the disinvestment process or otherwise. Furthermore, the invitation confers neither any right  nor expectation to any party to participate in the said process.

 

4.7              The GOI and BBUNL reserve the right to withdraw from the process or any part thereof, to accept or reject any or all offers at any stage of the process and/or modify the process or any part thereof or to vary any terms at any time without assigning any reason whatsoever. No financial obligation whatsoever shall accrue to the GOI or BBUNL or the Advisor in such an event.

 

5.       INITIAL PROCESS

 

5.1              Following receipt of this PIM, Interested Parties will be required to submit an EoI Package comprising an Expression of Interest, a Statement of Legal Capacity and a Request for Qualification (RFQ) in the format specified in Annexure II, III and IV.

 

5.2              Based on an evaluation of the EoI Package received, Interested Parties which are deemed fit (“Qualified Interested Parties” or “QIPs”) will be allowed to participate in the subsequent selection process (without conferring any right or expectation whatsoever to the QIPs).

 

5.3              Following signing of a Confidentiality Agreement (“CA”) by duly authorized personnel, QIPs will be provided with the Confidential Information Memorandum (“CIM”) and invited to participate further in the process as detailed in the CIM.

 

6.                  FILING REQUIREMENTS

 

6.1              Interested parties must submit, in duplicate, their EoI accompanied by a Statement of Legal Capacity and Request for Qualification (“RFQ”) the {“EoI Package”}, as per the formats given in Annexure II, III & IV of this PIM.

 

6.2              EoIs must be duly signed by the authorised representative of the interested party(ies) / designated lead bidder of the consortium. However, the RFQ and the Statement of Legal Capacity will have to be submitted by each member of the consortium, duly signed by an authorised official of the member.

 

6.3              All EoI Packages must be in English and each copy shall be bound in a separate volume.  Submission of the aforesaid documents by fax, e-mail or other electronic means will not be acceptable.  It is the responsibility of the interested party(ies) alone to ensure that its EoI with required documents is delivered at the address given below by the stated time and date.  The covering envelope containing the aforesaid document should be clearly marked “Private and Confidential - Expression of Interest for participation in disinvestment in BCL”. Neither BBUNL nor the Advisor shall be responsible for non-receipt of correspondence.

 

6.4              The EoI Package must be submitted by no later than 17.30 hours (Indian Standard Time), 15^th January, 2003 at the following address:

 

Shri Shaji John Manager Merchant Banking UTI Bank Limited 7, Shakespeare Sarani Kolkata - 700 071 E-mail : shaji.john@utibank.co.in Tel : +91 033 2282 4973 /9832/33/34/2933/4961 Fax : +91 033 2282 6463 / 7611

7.       EOI FILED BY CONSORTIA/JOINT VENTURES

 

7.1              If a Consortium or Joint Venture is formed, or proposed to be formed, specifically for the purpose of this investment, details of the members of the Consortium or Joint Venture and the extent of their interest herein must be provided in the EoI Package.

 

7.2              Any subsequent change by way of withdrawal/substitution of any member of the consortium or joint venture or any change affecting the composition of the consortium or joint venture may be permitted, but only with the specific approval of the GoI.  The GoI or BBUNL or the Advisor have the sole discretion to determine the impact of the change in membership on the structure and quality of the Consortium or joint venture and reject a proposal without assigning any reason whatsoever.

 

The RFQ should be duly filled in and accompanied by the following details:

 

Ø      In case of a sole bidder

 

·         The Audited Balance Sheet and Profit & Loss Account of the sole bidder (Indian company/OCB/Foreign company) for the last 3 financial years.

 

·         Write-up on :

a)     Profile of the sole bidder

b)     A statement of reasons for strategic interest in BCL

c)     Any other information considered material

 

Ø      In case of a consortium bid

·         The Audited Balance Sheet and Profit & Loss Account for the last 3 financial years of the lead bidder and other member companies associated in the bid.

·         Write-up on :

¨       Lead bidder

a)     Profile of the lead bidder

b)     A statement of reasons for strategic interest in BCL

c)     Any other information considered material by the lead bidder

¨       Other member companies

a)     Profile of member companies in the consortium

b)     Any other information considered material by the lead bidder

 

8.         DISQUALIFICATIONS

 

8.1              The GOI/BBUNL/Advisor shall not consider for the purpose of qualification, an EOI which has been found to be incomplete in content or attachment or authenticity.

 

8.2              Without prejudice to any other rights or remedies available to the GOI/BBUNL/Advisor, a company/consortium/association of employees may be disqualified and its EOI dropped from further considerations for any of the reasons listed below:

ü      Material misrepresentation by such company/member of consortium/ association of employees in the EOI and/or RFQ or otherwise.

 

ü      Failure by such company/consortium/association to provide the information required to be provided in the EOI and RFQ, and

 

ü      Submission of EOI and RFQ in respect of any company/consortium/ association, where such company or member had already submitted an EOI or is a member of a consortium, which has already submitted an EOI and the earlier EOI has not been withdrawn.

 

8.3              If any information becomes known after the interested party has been qualified to receive the Confidential Information Memorandum(CIM), which would have entitled the GOI/BBUNL/Advisor to reject or disqualify the relevant company/consortium, the GOI/BBUNL/ Advisor reserves the right to reject the interested party at the time or at any time after such information becomes known to the GOI/BBUNL/ Advisor.

 

8.4              Further, Government of India have issued guidelines for disqualification of bidders seeking to acquire any public sector enterprises through the process of disinvestment vide Department of Disinvestment OM No. 6/4/2001– DD-II dated 13^th July 2001, a copy of which is enclosed as Annexure V. The interested entities should not have been convicted by a Court of Law or indicted/have any adverse order passed against them by any Court of Law, or any other regulatory authority in any matter involving a grave offence and / or which casts a doubt on their ability to manage BCL. Further such persons or companies, entities and / or their sister concern(s) should not have any chargesheets against them by any agency of the GOI or any Court of Law, which involves the matter concerning the security and integrity of India. The final decision in this regard would be taken by the GOI. The GOI, vide its circular F.NO.4/95/2000-DD (Vol. V), has clarified which offence can be treated as a “grave offence” as under:

 

a)     Only those orders of SEBI are to be treated as coming under the category of “grave offences” which directly relate to “fraud” as defined in the SEBI Act and/or regulations.

 

b)     Only those orders of SEBI that cast a doubt on the ability of the bidder to manage the public sector unit when it is disinvested, are to be treated as adverse.

 

c)     Any conviction by Court of Law.

 

d)     In cases in which SEBI also passes a prosecution order, disqualification of the bidder.

 

The interested party(ies) are required to read the guidelines and satisfy themselves that they are qualified to bid for the stake in BCL through the process of disinvestment and give an undertaking to the effect that they are qualified to bid for the stake in BCL in the EOI to be submitted by them. Further, interested parties would be required to provide the information on the criteria, laid down in the guidelines of 13.07.2001 along with their EOI. The bidders shall be required to provide with their EOI an undertaking to the effect that no investigation by a regulatory authority is pending against them. In case any investigation is pending against the concern or its sister concern or against its CEO or any of its Directors/Managers/employees/members, full details of such investigation including the name of the investigating agency, the charge/offence for which the investigation has been launched, name and designation of persons against whom the investigation has been launched and other relevant information should be disclosed, to the satisfaction of the Government. For other criteria also, regarding the matters concerning the security and integrity of India, a similar undertaking shall be provided along with EOI.

 

8.5              Where the interested party is a consortium/association, BBUNL may disqualify the entire consortium/association for any of the reasons specified in paragraph numbers 8.1, 8.2, 8.3, and 8.4, even if it is applied to only one member of the consortium/ association.

 

8.6              The companies/consortia/associations not satisfying the eligibility and requisite qualification criteria specified in the above sections are not eligible.

 

9.         FUTURE PROCESS

 

9.1              The EOI submitted by interested parties shall be evaluated on the basis of the criteria specified elsewhere in this document. If at any time, during the evaluation process, BBUNL/Advisor require any clarification, it reserves the right to request for such information from any or all of the companies/consortia/associations and the companies/consortia/associations will be obliged to provide the same within reasonable time frame.

 

9.2              Based on an evaluation of EOIs received, interested parties, which are deemed fit (“qualified interested parties” “QIP”), will be qualified to participate in the subsequent selection process (without conferring any right or expectation whatsoever to QIP). QIP will be provided with the Confidential Information Memorandum (CIM) and shall be invited to participate further in the process described in details in the CIM. QIP will get an opportunity to conduct due diligence and take up site visits and will also have access to data rooms and to hold discussions with the management of BCL/BBUNL/officials of Ministry of Heavy Industry and Public Enterprises/ Ministry of Disinvestment, Government of India. The rules regarding access to information in the data rooms will be provided to QIPs later. QIPs will be invited to submit their proposal and a binding price bid.

 

9.3              This document constitutes no form of commitment on the part of the GOI or BBUNL or the Advisor other than to provide further information on BCL.  Furthermore, this document confers neither the right nor an expectation on any party to participate in the proposed divestment process.  The GOI/BBUNL/Advisor reserve the right to withdraw from the process or any part thereof or vary any terms at any time without assigning any reasons.  The GOI /BBUNL reserves the right to accept or reject any/all offer(s) without assigning any reasons.

 

9.4              The GOI may consider financial restructuring of BCL at a later date if considered necessary.

 

10.       ENQUIRIES

 

10.1          The GOI/BBUNL/Advisor reserve the right not to respond to question raised or provide clarifications sought, in their sole discretion, if it is considered that it would be inappropriate to do so. Nothing in this document shall be taken or read as compelling or requiring the GOI/BBUNL/Advisor to respond to any question or to provide any clarification. No extension of any time and date referred to in this PIM shall be granted on the basis or grounds that the GOI/BBUNL/Advisor has not responded to any question / provided any clarification.

 

11.       GOVERNING LAWS / JURISDICTION

 

11.1          The laws of Union of India shall govern all matters relating to the joint venture formation process and the bidding procedure. Only Courts at Kolkata (with exclusion of all other Courts) shall have the jurisdiction to decide or adjudicate on any matter, which may arise out of or in connection with the joint venture participation.

 

PART II

 

BRIEF PROFILE OF Braithwaite & Co. Limited (BCL)

 

 

1.         INTRODUCTION

 

1.1              Braithwaite & Co. Limited(“BCL” or “the Company”) is a Government company under the administrative jurisdiction of the Department of Heavy Industry, Ministry of Heavy Industry and Public Enterprises, Government of India.

 

1.2              The Company (BCL) was incorporated in West Bengal as BRAITHWAITE & CO. (INDIA) LIMITED on 28.02.1930. The management of the company was taken over by the Govt. of India on 06^th March,1971 and the company was subsequently nationalised w.e.f. 1^st December, 1976. BCL became a wholly owned subsidiary of the holding company Bharat Bhari Udyog Nigam Ltd., (BBUNL) upon its formation in September, 1986. BCL was referred to BIFR in, 1992.

 

1.3              BCL is one of the largest wagon manufacturers in India with an installed capacity of 4350 FWUs. It is backed by composite infrastructure for manufacture of Tank/Special Wagons and components including a dedicated Steel foundry. BCL delivers wide range of other engineering products & services viz. Cranes, Jute Carding Machines, other misc. machine jobs etc.,

 

1.4              Two manufacturing units and the registered office of the Company are located at Kolkata and another manufacturing unit is located at Bhadreswar, 40 Kms. away from Howrah station in the state of West Bengal.

 

1.5              BCL is the first wagon manufacturing company in India to possess ISO 9002 certification for its Quality Management System in wagon manufacturing and marketing. Its crane manufacturing unit possess ISO 9001 and foundry products have ISO 9002 certification.

 

KEY STRENGTHS OF BCL

 

The key strengths of BCL include :

 

v      One of the largest wagon manufacturers in the country, having complete infrastructure for the same.

v      Strategically located with close proximity to Kolkata port, airport as well as railway stations.

v      Exported wagons to many countries of the World.

v      Diversified range of engineering products and services.

v      Adequate power supply.

v      Products meet quality requirements of both national and international standards and the Company possesses ISO 9000 certification for its Quality Management System for various products viz. Wagons, Cranes, Foundry products etc.

v      Large pool of skilled and experienced manpower.

v      Cordial industrial relations with no company specific closure on account of labour unrest in its operations.

v      Regular capital investment has been made to modernise wagon making and foundry facilities with an objective to manufacture complete special purpose wagons and high quality tank wagons in particular.

v      Enterprise Resource Planning (ERP) package is under implementation stage to increase the cost effectiveness.

v      Capacity to develop new products within a short learning time (Bogie, Coupler, Dished Ends and LPG Bullets).

v      Diversified range of engineering products and services to safeguard the fluctuation of wagon orders.

 

1.6       BCL’s Client Profile

 

In India, the clients of BCL include The Indian Railways, NALCO, SAIL, Neelachal Ispat Nigam Ltd., Kolkata Port Trust and Oil Companies like Indian Oil Corporation Ltd., Hindustan Petroleum Ltd., Bharat Petroleum Ltd., etc., are the customers for Wagons. The clients for Cranes, Spares and services include major Ports, Steel Plants, CONCOR etc. BCL is also a pioneer in export of Railway Rolling Stocks from India. BCL have exported railway wagons to different countries like Korea, Taiwan, Vietnam, Tanzania, Sri Lanka, Zambia, Uganda, Burma, Philipines and Yugoslavia. The company has exported heavy structural steel works for Power Houses to Malaysia & New Zealand. The company has also exported Petrol Tank Wagons (PTW) & Bogies to M/s. SITARAIL, Ivory Coast.

 

1.7       MANPOWER

 

The current employee strength is 65.31% below BIFR sanctioned scheme (1180 Nos. as against 3402 Nos. as on 31.3.2002). BCL has been able to reduce its employee strength from 2357 Nos. (as on 31.03.01) to 1180 Nos. (as on 31.03.2002) by implementation of rollback of retirement age of employee from 60 to 58 years and Voluntary Retirement Scheme in February’02 and March’02 respectively.

 

1.8       FINANCIALS

 

EQUITY BASE

  

	Rupees in Millions As on 31.03.2002
SHARE CAPITAL
AUTHORISED
9,50,000 Equity Shares of Rs. 1000/- each	950.00
ISSUED AND SUBSCRIBED
9,49,024 Equity Shares of Rs. 1000/- each fully paid up.	949.02
SHARE DEPOSIT – PENDING ALLOTMENT	107.47

All shares are held by BBUNL being Holding Company and its nominees.

 

(a)  Profitability

1.      During the financial year 2001-2002, BCL registered a net loss of Rs. 335.55 million as against a profit of Rs.17.37 million in the previous year. Operating result for the year 2001-2002 vis-à-vis 2000 – 2001 are tabulated below:         

                                                                                       (Rs. In millions)

Particulars	2001-2002	2000 –2001
Sales	405.24	1118.35
Gross Profit / (Loss) (Ex-interest & depreciation)	(266.91)	61.10
Cash Profit/ (Loss)	(319.67)	32.92
Net Profit/ (Loss)	(335.55)	17.38

2. Summary of BCL’s Balance Sheet and Profit and Loss Account for the last three years is given below.

Balance Sheet                      (Rupees In millions)

As on	31st March 2000	31st March 2001	31st March 2002
LIABILITIES
a) Paid-up Capital
i)                    Government of India / BBUNL	949.02	949.02	949.02
ii) Share Deposit (Government of India/BBUNL) including conversion of loan to equity	20.75	79.34	107.47
c) Reserve & Surplus      Capital Reserve	0.44	0.44	0.44
Borrowings from
i)                    Government of India / BBUNL Plan Non-Plan	51.72 108.00	61.73 108.00	61.73 317.08
ii) Banks/Financial Institution including Govt. of West Bengal. Cash Credit Others	183.73 12.52	164.89 10.22	174.81 3.35
ii)                   Interest Accrued and due	3.70	8.33	51.78
Current Liabilities & Provisions	703.95	588.02	544.15
TOTAL	2033.83	1969.99	2209.83
ASSETS
Gross Block	368.97	395.99	404.99
Less : Cumulative Depreciation	184.96	200.49	215.67
Net Block	184.01	195.50	189.32
Capital Work-in-Progress	14.37	7.46	37.41
Investments	0.20	0.26	0.26
Current Assets, Loans and Advances	645.48	594.38	406.91
Misc. Expenditure (to the extent not written –off or adjusted)	-	-	67.99
Accumulated Losses	1189.77	1172.39	1507.94
TOTAL	2033.83	1969.99	2209.83

 

 

PROFIT & LOSS ACCOUNT

(Rs. in millions)

Year Ended	31st March 2000		31st March 2001	31st March 2002
INCOME
Sales	620.44		1118.35	405.24
Other Revenue	10.30		16.35	13.73
Accretion/(Decretion) to Work-in-Progress	28.05		(53.47)	3.72
Grant-in-aid (VRS)	--		--	--
TOTAL	658.79		1081.23	422.69
EXPENDITURE
Consumption of raw materials		264.17	467.67	162.04
Manufacturing Expenses & Other Direct Costs		36.08	31.83	30.02
Stores, Spares Parts and Loose Tools Consumed		28.74	47.70	15.91
Employees’ Remuneration		263.85	273.19	234.25
Power & Fuel		36.54	39.01	36.18
Other Expenses		41.73	47.74	46.41
Excise & Customs Duty		40.36	110.46	25.80
Depreciation		13.09	15.54	15.88
Interest		27.21	28.17	52.76
VRS Expenses / loan		--	--	23.61
TOTAL		751.77	1061.3 1	642.86
Profit/Loss for the year (before prior period adjustment and provisions)		(92.96)	19.92	(220.17)
Prior Period Adjustment (Net)		(4.58)	7.18	(50.85)
Provision relating to Prior Period		(43.74)	(9.72)	(64.53)
Profit/(Loss) before Tax		(141.28)	17.38	(335.55)
Provision for Tax		--	--	--
Net Profit/ (Loss) after Tax		(141.28)	17.38	(335.55)
Loss brought forward from previous year		(1048.49)	(1189.77)	(1172.39)
Balance carried to Balance Sheet		(1189.77)	(1172.39)	(1507.94)

 

Details on the Units

 

1.90          BCL possesses three operational manufacturing units viz. Clive, Victoria & Angus spread over the states of West Bengal. The company’s two of the manufacturing units (Clive & Victoria) are located at Kolkata & Angus (Bhadreswar, Hooghly Dist). They are engaged in manufacturing of Rolling Stocks, Steel Castings, Structurals, Cranes, Jute Machineries, LPG Bullets and Wagon Components. BCL is one of the major Rolling Stock manufacturers in the country and has an annual capacity of 4350 FWU’s.  Its product range includes various types of Broad Gauge rolling stocks, such as BCNA, BTPN, BTAP, BTPGLN, BOBRN, BOXN, and BTCS, Cranes, Jute Machineries, Bogies, Couplers and Dished end etc.

 

2.0              BCL’s Steel Foundry is located at its Angus Unit situated at Bhadreswar, in Hooghly Dist., in the State of West Bengal. The facilities provided are capable for producing high quality castings having annual capacity of approx. 3000 MT. On completion of on-going modernisation work, the foundry shall be further equipped with modern plant and equipment and increase its capacity which may lead to self-sufficiency in the requirement of bogies and couplers.

 

2.1         BCL also have a Marketing and Project Division at Chowringhee, Kolkata. The Project Division at Kolkata was formed in 1978 to handle turnkey projects. Due to lack of orders, the operation of the Project Division was ceased. It houses the Marketing Division at present.

 

Subsidiary Companies

 

2.2              BCL does not have any subsidiary company.

 

2.3              Unitwise details of capacity, production performance are given in the tables below :

 

 

INSTALLED CAPACITY

 

Works	Major Products		Installed Capacity
Clive (Kolkata)	Box Type BCNA Wagons Special Type BTAP Wagons Barrel Type BTPN Wagons Export Wagon (Sita Rail) Structurals	FWUs FWUs FWUs FWUs MT.	2700 }       }              510 } 6500
Victoria (Kolkata)	Barrel Type BTPGLN Wagon Barrel Type BTPN Wagon Structurals Bullet – LPG carrying vessel	FWUs FWUs MT. Nos.	} }               240 4920 --
Angus (Bhadreswar)	Barrel Type BTPN Wagon Barrel Type BTCS Wagon Jute Machineries Steel Castings	FWUs FWUs Nos. MT.	} }               900     48 3000

 

PRODUCTION PERFORMANCE FOR THE LAST 2 YEARS

 

(Value in Rs. millions)

WORKS	2000-2001			2001-2002
	Qty	Gross	Billable	Qty	Gross	Billable
Clive (Kolkata)	---	773.54	505.63	---	419.85	222.90
Angus (Bhadreswar)	---	563.94	370.684	----	250.34	116.36
Victoria (Kolkata)	---	133.64	93.66	----	81.78	50.83
Total BCL	---	1471.12	969.97	---	751.97	390.09

Operating Units of BCL

 

1A. Clive Works : BCL

 

               

Location	5, Hide Road, Kolata 700 043, Tel Nos. +91 (033) 2449 7413 / 2439 4114 / 7415 / 6217, Fax Nos. +91 (033) 2439 5607, E-mail : braith.company@gems.vsnl.net.in
Main Products	Railway Rolling Stock, Export & Non-Railway Wagons & Structural Fabrication
Main Industries served	Railways, Non-Railways ( Oil Sector,, NALCO)
Production :	Phy Unit	2001-02		2000-01	1999-00
- Wagon - Export Wagon - Structural (Bridge Structures)	FWUs FWUs MT	891.55 ----- 1158.60		1438.925 76.875 ---	1296.925 48.125 ---
Performance :		2001-02		2000-01	1999-00
- Sales Turn over - Net Profit	Rs. Mio. Rs. Mio.	239.09 (201.74)		553.75 (14.53)	386.19 (76.95)
Manpower (Nos.) :-                                    As on 31. 03. 02
Officer     Supervisors     Staff     Technical Staff     Sub-Staff     Workmen     Total	-                             51 -                             20 -                             25 -                             15 -                              28 -                             370 -                            509
Land Area	( Acres) Free hold Lease hold      Total   :		--- 18.577 18.577
Other Information	¨      ISO accredited manufacturing facilities ¨      Installed capacity : # Wagon: 3210 FWUs # Structurals : 6500 MT per annum

 

1B.  Victoria Works : BCL

 

Location	P-61, Circular Garden Reach Road, Kolkata 700 043. Tel Nos. +91 (033) 2439 5705, Fax Nos. +91 (033) 2439 4621
Main Products	Railway Rolling Stock, LPG Bullets, Structural Fabrication
Main Industries served	Railways, Oil Sector ( IOCL, HPCL)
Production :	Phy Unit	2001-02		2000-01	1999-00
-         Wagon  -         LPG Bullets -         Structural	FWUs Nos MT	134.90    2.68 ---		176.35 3.38 ---	107.58 2.35 ---
Performance :
- Sales Turn Over - Net Profit	Rs. Mio Rs. Mio	55.03 (28.25)		105.24 (5.31)	78.25 (16.02)
Manpower (Nos.):                            As on 31. 03. 02
Officer Supervisor    Staff Technical Staff Sub-Staff Workmen Total	-                          7 -                        12 -                           4 -                           1 -                           1 -                         62 -                        87
Land Area	( Acres) Free hold Lease hold      Total   :		--- 4.51 4.51
Other Information	¨      ISO accredited manufacturing facilities          Manufacturing of Wagons ¨      Installed capacity : # Wagon: 240 FWUs # Structurals : 4920 MT per annum

 

 

1C. Angus Works : BCL

 

Location	P.O. Angus, Dist. Hooghly, West Bengal 712 221 Tel Nos. +91 (033) 2633 5463 / 5464 / 6376, Fax Nos. +91 (033) 2633 6377
Main Products	Railway Rolling Stock, Cranes (EOT, Level Luffing, RTG etc), Jute Machineries, Steel Castings, Bogie & Coupler etc.
Main Industries served	Railways, Steel Plants, Port Trusts
Production :	Phy Unit	2001-02		2000-01	1999-00
-         Wagon -         Crane -         Bogie -         Coupler -         Steel Casting -         Jute Machineries	FWUs Rs. Mio. Nos. Nos. MT Nos.	237.50 19.29 713 352 1382 1		782.50 19.16 999 190 1515 ---	597.50 23.65 860 --- 1177 ---
Performance :		2001-02		1999-00	1999-00
- Sales Turn Over - Net Profit	Rs. Mio Rs. Mio	111.12 (105.56)		422.24 37.22	194.36 (48.31)
Manpower (Nos.) :                                         As on 31. 03. 02
Officer     Supervisors     Staff     Technical Staff     Sub-Staff     Workmen     Total	43 29 36 10 37 379 534
Land Area	( Acres) Free hold Lease hold Licence basis     Total   :		0.808 69.866  0.1148 70.789
Other Information	¨      ISO accredited manufacturing facilities # Manufacturing of Wagons # Manufacturing of Cranes # Manufacturing of Steel Casting Products ¨          Installed capacity : # Wagon : 900 FWUs # Cranes : 3100 MT of crane weight # Jute Carding Machines : 48 nos. # Steel Castings : 3000 MT

 

 

1D. UNITS AS A WHOLE - BCL

 

Location	5, Hide Road, Kolata 700 043, Tel Nos. +91 (033) 2449 7413 / 2439 4114 / 7415 / 6217, Fax Nos. +91 (033) 2439 5607, E-mail : braith.company@gems.vsnl.net.in
Main Products	Railway Rolling Stock, Export & Non-Railway Wagons & Structural Fabrication, Cranes (EOT, Level Luffing, RTG etc.), Jute Machineries, Steel Castings, Bogie & Coupler etc., LPG Bullets, Structural Fabrication.
Main Industries served	Railways, Non Railways,Oil Sector, NALCO, Steel Plants, Port Trusts
Production :	Phy Unit	2001-02		2000-01	1999-00
-         Wagon -         LPG Bullets -         Export Wagon -         Crane -         Couplers -         Bogie -         Steel Casting -         Jute Machineries -     Structural	FWU’s Nos. FWU’s Rs. Mio. Nos. Nos. MT Nos. MT	1263.95 2.68           - 19.29 352 713 1382 1 1158.60		2397.775 3.38 76.875 19.16 190 999 1515 --- ---	2002.005 2.35 48.125 23.65 --- 860 1177 --- ---
Performance :		2001-02		2000-01	1999-00
- Sales Turn Over - Net Profit	Rs. Mio Rs. Mio	405.24 (335.55)		1081.23 17.38	685.80 (141.28)
Manpower (Nos.) :                                           As on 31. 03. 02
Officer Supervisors    Staff Technical Staff Sub-Staff Workmen Total	-                                    127 -                                      65 -                                      79 -                                      26 -                                      72 -                                    811 -                                  1180
Land Area	( Acres) Free hold Lease hold Licence basis     Total   :		0.808 92.9542   0.1148 93.8770
Other Information	¨      ISO accredited manufacturing facilities # Manufacturing of Wagons # Manufacturing of Cranes # Manufacturing of Steel Casting Products ¨          Installed capacity : # Wagon : 4350 FWUs # Cranes : 3100 MT of crane weight # Structurals : 11420 MT # Steel Castings : 3000 MT

 

2.4              Unitwise Financial Performance for the year ended  31.03.2002 is as  

            under :

(Rs. in millions)

Description	Clive Works	Victoria Works	Angus Works	Total BCL
A.      PRODUCTION 1.       Gross Prod. 2.     Free Supply	419.85 230.77	81.78 36.57	250.34 35.45	751.97 302.79
Billable Production	222.90	50.83	116.36	390.09
B.       INCOME 2         Sales 3         Excise Duty 4         Accr(+)/Decr(-) of CIP 5         Other Income 6         Inter-unit Income	231.99 7.10 (9.09) 5.89                 ----	50.46 4.58 0.37 (0.19)                   ---	103.91 7.20 12.44 8.03 39.44	386.36 18.88 3.72 13.73 39.44
7         Gross Outturn	235.89	55.22	171.02	462.13
C.      MFG. & OTHER EXPENSES 8         Raw Mat. Consumption 9         Bought Out 10     Stores & Spares 11     Sub Contracting 12     Other Direct Charges 13     Inter Unit Cost 14     Total Consumption (9 to14) 15     Total Employment Cost 16     Power & Fuel 17     Repair & Maintenance 18     Other Overheads 19     Provision 20     Excise Duty 22.  Total O.C. (18 to 21)	3.66 72.36 8.65 5.22 8.32 33.82 132.03 131.10 12.95 3.87 25.65 26.94 16.71 73.17	1.81 18.71 2.24 5.65 1.21 5.62 35.24 11.44 2.09 0.80 4.71 5.90 6.59 18.00	23.53 41.97 5.02 6.95 2.67                 -   80.14 91.71 21.14 0.46 10.92 31.69 5.50 45.57	29.00 133.04 15.91 17.82 12.20 39.44 247.41 235.24 36.18 5.13 41.28 64.53 25.80 136.74
23. Total Expenses        (15+16+17+22)	349.25	66.77	238.56	654.58
24.    Cash Profit/Loss – Excl. Interest (8-23) 25.    Bank / other Interest 26.  Govt. Interest 27.    Cash Profit/(Loss) – Incl. Intt. (24-25-26) 28.    PriorPeriod adjustment(net) 29.    VRS Expenses 30.    Depreciation 29.   Net Profit/(Loss) – (27-28)	(113.36)   10.43 20.33 (144.12)   (38.08) 14.50 5.04 (201.74)	(11.55)   2.39 4.68 (18.62)   (5.20) 1.55 2.88 (28.25)	(67.54)   5.48 9.45 (82.47)   (7.57) 7.56 7.96 (105.56)	(192.45)   18.30 34.46 (245.21)   (50.85) 23.61 15.88 (335.55)

 

ANNEXURE – I : ADVERTISEMENT

 

Bharat Bhari Udyog Nigam Limited

(A Govt. of India Undertaking)

 

This announcement is neither a prospectus nor an offer or invitation to the public for sale of securities.

 “Expression of Interest”

 

Bharat Bhari Udyog Nigam Limited (BBUNL) intends to sell 60%, of its holding in its wholly owned subsidiary Braithwaite & Co. Limited (BCL) to a strategic investor with transfer of management. UTI Bank Ltd. in association with Deloitte Touche and Tohmatsu India Pvt. Ltd., has been retained as Advisors by BBUNL in connection with the proposed strategic sale.

 

BCL is one of the largest wagon manufacturers in India with an installed capacity of 4350 FWUs. It is backed by composite infrastructure for manufacture of Tank/Special Wagons and components including a dedicated Steel foundry. BCL delivers wide range of other engineering products & services viz. Cranes, Jute Carding Machines, other misc. machine jobs etc. The company has three manufacturing units.

 

Company(ies)/Joint Venture(s)/Consortium(s) (incorporated or to be incorporated) interested in participating in the proposed disinvestment are required to submit Expression of Interest (EoI) at the undermentioned address, not later than 17.30 hours by 15^th January, 2003.

 

The Preliminary Information Memorandum (PIM) containing further information about BCL, qualification requirements, formats for EoI and RFQ can be obtained from the undermentioned officer or accessed at www.bbunl.com/ www.divest.nic.in/ www.dhi.nic.in.

 

 

Shri Shaji John Manager UTI Bank Ltd. 7, Shakespeare Sarani, Kolkata 700071 E-mail : shaji.john@utibank.co.in Tel: +91 033 2282 4973/ 9832/33/34 Fax : +91 033 2282 6463

 

 

 

   

 

GoI/BBUNL reserves the right to withdraw from the process or any part thereof, to accept or reject any or all offers at any stage of the process and/or modify the process or any part thereof or to vary any terms at any time without assigning any reason whatsoever. No financial obligation, whatsoever shall accrue to GoI/BBUNL in such an event. Neither GoI nor BBUNL shall be responsible for non receipt of correspondence sent by post/courier/e-mail/fax.

ANNEXURE – II : EXPRESSION OF INTEREST

 

(To be forwarded on the letterhead of the interested party/lead bidder/member of the consortium submitting the EOI)

 

Reference No…………….                                                               Date ……………..

 

Shri Shaji John

Manager

UTI Bank Ltd.

7, Shakespeare Sarani

Kolkata 700 071

 

 

Sub : GLOBAL INVITATION OF EXPRESSIONS OF INTEREST FOR DISINVESTMENT OF 60% STAKE OF BHARAT BHARI UDYOG NIGAM LTD. (BBUNL)  IN BRAITHWAITE & CO. LIMITED (BCL), A WHOLLY OWNED SUBISIDARY

 

Sir,

 

This is with reference to the advertisement dated ……….. inviting Expression of Interest for Braithwaite & Co. Limited (BCL).

 

As specified in the advertisement, we have read and understood the contents of the Preliminary Information Memorandum (PIM) and are desirous of participating in the above disinvestment process, and for this purpose :

 

We proposes to submit our EOI in individual capacity as ……………………… (insert company name)

OR

 

We have formed/proposes to form a consortium comprising  ……… members as follows:

 

1.                  …………………………………………  (insert company name)

2.                  …………………………………………  (insert company name)

3.                  …………………………………………  (insert company name)

 

OR

We are an association of BBUNL/its subsidiary/employees.

 

We confirm that we/our consortium/proposed consortium satisfies the eligibility criteria set out in relevant sections of the PIM including the guidelines for qualification of bidders seeking to acquire stakes in Public Sector Enterprises through the process of disinvestment issued by the Government of India vide Department of Disinvestment OM No.6/4/2001-DD-II dated 13^th July, 2001 and subsequent amendments/clarifications thereto. The Statement of Legal Capacity and Request for Qualification as per formats indicated hereinafter, duly signed by us/respective members, who jointly satisfy the eligibility criteria, are enclosed.

 

 

We certify that in regard to matters other than security and integrity of the country, we have not been convicted by a Court of law or indicated or adverse orders passed by a regulatory authority which would cast a doubt on our ability to manage the public sector unit when it is disinvested or which relates to a grave offences that outrages the moral sense of the community.

 

We further certify that in regard to matters relating to security and integrity of the country, we have not been charge-sheeted by any agency of the Government or convicted by a Court of Law for any offence committed by us or by any of our sister concerns.

 

We further certify that no investigation by a regulatory authority is pending either against us or against our sister concerns or against our CEO or any of our Directors/Managers/employees.

 

We undertake that in case due to any change in facts or circumstances during the pendency of the disinvestment process, we are attracted by the provisions of disqualification in terms of the subject guidelines, we would intimate the BBUNL of the same immediately.

 

We shall be glad to receive further communication on the subject.

 

Yours faithfully,

 

Authorised Signatory

 

                                    For and on behalf of the party/consortium

                       

Enclosure :

 

1.      Statement of Legal Capacity

2.      Request for Qualification

 

ANNEXURE – III : STATEMENT OF LEGAL CAPACITY

 

(To be forwarded on the letterhead of the interested party/each member of the consortium submitting the EOI)

 

 

Reference No……………………………..                                       Date……………..

 

Shri Shaji John

Manager

UTI Bank Ltd.

7, Shakespeare Sarani

Kolkata 700 071

 

 

Sub : GLOBAL INVITATION OF EXPRESSION OF INTEREST FOR DISINVESTMENT OF 60%  STAKE IN BRAITHWAITE & CO. LIMITED (BCL), A WHOLLY OWNED SUBISIDARY OF BHARAT BHARI UDYOG NIGAM LIMITED (BBUNL)

 

Sir,

 

This is with reference to the advertisement dated …………… inviting Expression of Interest for Braithwaite & Co. Limited (BCL).

 

We have read and understood the contents of the PIM and the advertisement and pursuant to this hereby confirm that :

 

We satisfy the eligibility criteria laid out in the PIM and the advertisement.

 

We are a member of the consortium (constitution of which has been described in the Expression of Interest) which jointly satisfies the eligibility criteria as detailed in the PIM.*

 

We have agreed that ………………….(insert member’s name) will act as the lead member of our consortium.*

 

We have agreed that …………………. (insert individual’s name) will act as our representative on our behalf and has been duly authorized to submit the EOI. Further, the authorized signatory is vested with requisite powers to furnish such letter and Request for Qualification and authenticate the name.*

 

Yours faithfully,

 

 

Authorised Signatory

 

For and on behalf of (party/member)

 

* Strike off whichever clause is not applicable.

 

ANNEXURE – IV : REQUEST FOR QUALIFICATION

 

(To be submitted in respect of interested party/each member of the consortium)

 

 

Name of the interested party(ies)/Member(s) …………………………………………..

 

1.      Constitution (Tick, wherever applicable)

 

i)                    Public Limited Company

ii)                   Private Limited Company

iii)                 Others, if any (Please specify)

 

2.      Sector (Tick, wherever applicable)

 

i)                    Public Sector

ii)                   Joint Sector

iii)                 Others, if any (Please specify)

 

3.      Details of Shareholding

 

4.      Role/Interest of each Member in the Consortium (if applicable)

 

5.      Nature of business/products dealt with

 

6.      Date & Place of incorporation

 

7.      Date of commencement of business

 

8.      Full address including phone Nos./Fax No.

 

(i)                  Registered Office

(ii)                Head Office

 

9.      Address for correspondence

 

10.  Basis of eligibility for participating in the process (Please mention details of your eligibility).

 

11.  Please attach most recent Audited Statement of Accounts/Annual Report. Please provide a Chartered Accountant/Auditor’s Certificate certifying the Net Worth.

 

12.  Please provide details of all contingent liabilities that, if materialised, that have or would reasonably by expected to have a material adverse affect on the business, operations (or results of operations), assets, liabilities and/or financial condition of the Company, or other similar business combination or transaction.

13.  Contact Persons :

 

i)    Name             :

ii)   Designation   :

iii)   Phone No.     :

iv)  Mobile No.    :

v)  Fax No.           :

vi)  E-Mail             :

 

Yours faithfully,

 

 

Authorised Signatory

For and on behalf of the (party/member)

 

 

Authorised Signatory

For and on behalf of the Consortium

 

Place :

Date  :

 

Note :  Please follow the order adopted in the Format provided. If the interested party is unable to respond to a particular question/request, the relevant number must nonetheless be set out with the word “No response given” against it.

ANNEXURE – V  : GOVERNMENT CIRCULAR

 

 

No.6/4/2001-DD-II

 

 

Government of India

Ministry of Disinvestment

Block 14, CGO Complex

New Delhi

 

 

Dated 13^th July, 2001

 

 

OFFICE MEMORANDUM

 

Sub : Guidelines for qualification of Bidders seeking to acquire stakes in Public Sector Enterprises through the process of disinvestment

 

Government has examined the issue of framing comprehensive and transparent guidelines defining the criteria for bidders interested in PSE-disinvestment so that the parties selected through competitive bidding could inspire public confidence. Earlier, criteria like net worth, experience etc., used to be prescribed. Based on experience and in consultation with concerned departments, Government has decided to prescribe the following additional criteria for the qualification/disqualification of the parties seeking to acquire stakes in public sector enterprises through disinvestment.

 

(a)    In regard to matters other than the security and integrity of the country, any conviction by a Court of Law or indictment/adverse order by a regulatory authority that casts a doubt on the ability of the bidder to manage the public sector unit when it is disinvested, or which relates to a grave offence would constitute disqualification. Grave offence is defined to be of such a nature that it outrages the moral sense of the community. The decision in regard to the nature of the offence would be taken on case to case basis after considering the facts of the case and relevant legal principles, by the Government.

 

(b)    In regard to matters relating to the security and integrity of the country, any change-sheet by an agency of the Government/conviction by a Court of Law for an offence committed by the bidding party or by any sister concern of the bidding party would result in disqualification. The decision in regard to the relationship between the sister concerns would be taken, based on the relevant facts and after examining whether the two concerns are substantially controlled by the same person/persons.

 

(c)    In both (a) and (b), disqualification shall continue for a period that Government deems appropriate.

 

(d)    Any entity, which is disqualified from participating in the disinvestment process, would not be allowed to remain associated with it or get associated merely because it has preferred an appeal against the order based on which it has been disqualified. The mere pendency of appeal will have no effect on the disqualification.

 

(e)    The disqualification criteria would come into effect immediately and would apply to all bidders for various disinvestment transactions, which have not been completed as yet.

 

(f)       Before disqualifying a concern, a Show Cause Notice why it should not be disqualified would be issued to it and it would be given an opportunity to explain its position.

 

(g)    Henceforth, these criteria will be prescribed in the advertisements seeking Expression of Interest (EOI) from the interested parties. The interested parties would be required to provide the information on the above criteria, along with their Expression of Interest (EOI). The bidders shall be required to provide with their EOI an undertaking to the effect that no investigation by a regulatory authority is pending against them. In case any investigation is pending against the concern or its sister concern or against its CEO or any of its Director/Managers/Employees, full details of such investigation including the name of the investigating agency, the charge/offence for which the investigation has been launched, name and designation of persons against whom the investigation has been launched and other relevant information should be disclosed, to the satisfaction of the Government. For other criteria also, a similar undertaking shall be obtained along with EOI.

 

 

Sd/-

(A.K. Tewari)

       Under Secretary to the Government of India.

 

       To

    

       As per list attached.