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Advertisements for Advisors
October
25th, 2001
AS
PER LIST ATTACHED
Dear
Sir,
Sub:
Engagement of an Advisor for Disinvestment in respect of Hindustan Newsprint
Ltd. (HNL), a subsidiary of Hindustan Paper Corporation Ltd.(HPC)
Hindustan
Paper Corporation Limited (HPC) intends to disinvest 74% stake in its wholly
owned subsidiary Hindustan Newsprint Ltd.(HNL) or 100% (ie. Outright sale)
through strategic sale or other means, and proposes to engage the services of an
Advisor to advise and manage the disinvestment process successfully.
A
brief Preliminary Information Memorandum in respect of HNL is enclosed for your
ready reference(Annexure 1)
The
responsibilities of the Advisor would, inter alia, cover rendering of advice and
assisting HPC 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 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.
Should you feel inclined to take up the assignment, you may submit
your statement of Interest, (EOI) for selection as Advisor, so as to reach us on
or before 1700 hours November 7, 2001 along with the details of your firm
inter alia covering the following:
1.
Full particulars of the constitution, ownership and main business
activities.
2.
Unabridged Annual Reports and audited financial accounts for the
last three years.
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 Central 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 HPC and the Subsidiary Company HNL including a SWOT analysis
incorporating key selling points and limitations.
- Proposed
methodology of the disinvestments/strategic sale transaction indicating the
issues involved including:
o
Valuation
of HNL
- Transaction
Structuring
- Marketing
Strategy
- Bid
Evaluation Methodology
- Tentative
Time Frame
- Details
of deal team:
o
Experience
and qualifications
- Team
members located abroad
- Team
members located in India
The Presentation will be held at New Delhi, the exact date - which may be within
about ten (10) days from the last date for submission of statement of Interest
– would be informed to the bidders who should be prepared at short notice.
The
bidders are required to submit at the time of making the presentation to the IMG
financial bids in sealed covers incorporating the fee chargeable as a percentage
of the sale proceeds from the disinvestments of HPC’s stake in HNL, gross of
all taxes. The bids should be unconditional.
Expenditure
on account of Fee to legal/accounting or any other consultant, if appointed by
HPC 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 HPC decides to call off the
transaction/assignment.
The
offer shall be kept open atleast for a period of 3 months from the date of
submission of the bid/statement of Interest. The selected bidder shall enter
into a Confidentiality Agreement with HPC in the prescribed format and shall
work in close association with HPC and the Subsidary Company HNL as well as the
IMG and/or the officials of the Department of Heavy Industry, Govt. of India.
The
bidders are required to submit along with their statement of Interest, a
non-refundable Earnest fee of Rs.20,000/-(Rupees Twenty Thousand Only) by way of
a Demand Draft payable at Kolkata in favour of HPC Limited. Any other form of
payment of the Earnest fee will not be entertained. HPC Limited reserves the
sole right to reject any or all statement(s) of Interest without assigning any
reasons.
The
statement of Interest should be sent in a sealed envelope only (not by fax or
e-mail) superscribing the same "statement of Interest for acting as
Advisors to HPC" and addressed to The Company Secretary, Hindustan Paper
Corporation Ltd., 75 c Park Street, Kolkata 700 016 Phone No.(033) 2496931-35
Fax No.(033) 245-7335/4932. The Demand Draft for the Earnest fee should be
enclosed in the same envelope. Bids/statement of Interest received without the
Earnest fee will not be considered and shall be rejected forthwith. Should you
require any further information and/or clarifications with regard to the scope
of the assignment or any matter connected thereto, you may contact the
undersigned for the same.
Yours
faithfully,
For
Hindustan Paper Corporation Ltd.
(Biplab
Chaudhuri)
Company
Secretary
ANNEXURE
I
HINDUSTAN
NEWSPRINT LIMITED
1.
Year of Formation as PSU : Hindustan Newsprint Limited was originally started as
a unit of HPC. Subsequently, HNL was formed as a wholly owned subsidiary to take
over the business of the Mill with effect from 1st October 1983, as a
going concern. Commercial production started from November, 1982.
2.
Location : Newsprint Nagar, Kottayam, Kerala
3.
Product Mix & Capacity : Newsprint 1 lakh TPA. Also having a
licence to produce 20,000 MT Writing and Printing Paper per annum.
4.
Capital: Authorised : Rs.100.00 crore
Paid
up : Rs. 82.54 crore
5.
Manpower as on : 1455
31.3.2001
- Annual
wage Bill (31.3.2001) : Rs.34.58 crores
6a.
Status of salary/wages paid : Upto September 2001
7.
Accumulated profit as on : Rs.126.97 crore
31.3.2001
(including reserves)
8.
Performance
(Rs.
in crores)
|
|
1995-96 Actual |
1996-97 Actual |
1997-98 Actual |
1998-99 Actual |
1999-00 Actual
|
2000-01 Actual |
2001-02
Target |
Target
Apl- Sep 2001 |
Actual
Apl-Sep 2001 |
|
Production (Tonnes) |
101111 |
70287 |
85038 |
105570 |
91004 |
104004 |
105000 |
52800 |
48521 |
|
Turnover |
269.23 |
141.93 |
189.72 |
221.09 |
212.49 |
253.36 |
291.90 |
146.79 |
125.39 |
|
Operating
Profit |
98.04 |
16.16 |
13.84 |
34.05 |
16.15 |
40.15 |
43.90 |
22.27 |
14.00 |
|
Net
Profit (after
tax) |
51.26 |
4.16 |
2.19 |
20.63 |
2.99 |
15.36 |
33.38 |
17.01 |
8.96 |
9.
|
|
As
on 31.3.2001 |
As
on 30.9.2001 |
|
Inventory
(Rs. in crore) |
3.97 |
17.43 |
|
Sundry
Debtors (Rs. in crores) |
7.78 |
23.20 |
9.a.
VRS :
1999-2000 59 employees
2000-2001 20 employees
|
TEN
YEAR DIGEST |
|
|
|
|
|
|
|
|
|
|
Rs.lakhs |
|
|
PARTICULARS |
1991-92 |
1992-93 |
1993-94 |
1994-95 |
1995-96 |
1996-97 |
1997-98 |
1998-99 |
99-2000 |
2000-01 |
|
A |
OPERATING
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
Production
(MT) |
90181 |
97015 |
98600 |
105369 |
101111 |
70287 |
85038 |
105570 |
91004 |
104004
|
|
|
Sales
(MT) |
90093 |
93987 |
96041 |
110126 |
100009 |
63972 |
92022 |
95220 |
100682 |
103923
|
|
|
Sales
Turnover |
14,777 |
16,393 |
17,590 |
21,762 |
26,923 |
14,194 |
18,972 |
22,109 |
21,249 |
25,336
|
|
|
Value
of Production |
14,808 |
16,762 |
17,972 |
21,129 |
27,117 |
15,472 |
17,642 |
23,886 |
19,577 |
25,402
|
|
|
Other
Income |
171 |
129 |
176 |
217 |
226 |
232 |
192 |
273 |
255 |
349
|
|
|
Materials |
7,929 |
9,880 |
10,861 |
12,550 |
14,170 |
10,414 |
11,994 |
14,899 |
13,550 |
17,588
|
|
|
Employees'
Remuneration & Benefits |
1,029 |
1,256 |
1,356 |
1,554 |
1,762 |
1,890 |
2,388 |
2,801 |
3,034 |
3,458
|
|
|
Depreciation |
1,000 |
320 |
409 |
702 |
769 |
833 |
859 |
927 |
892 |
807
|
|
|
Interest
(Net) |
(185) |
31
|
290
|
263
|
(401) |
(31) |
(136) |
(373) |
(441) |
(807) |
|
|
Manufacturing
& Other Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
incl.
Write-off & Prior Period adj. |
1,405 |
1,422 |
1,472 |
1,840 |
2,008 |
1,813 |
2,204 |
3,443 |
2,075 |
1,670
|
|
|
Profit
before Tax (PBT) |
3,801 |
3,982 |
3,760 |
4,438 |
9,035 |
785 |
525 |
2,462 |
721 |
3,036
|
|
|
Provision
for Tax |
2,353 |
2,032 |
1,512 |
646 |
3,909 |
353 |
289 |
354 |
404 |
1,415
|
|
|
Profit
after Tax (PAT) |
1,448 |
1,950 |
2,248 |
3,792 |
5,126 |
432 |
236 |
2,108 |
317 |
1,620
|
|
|
Dividend
|
1,651 |
1,238 |
825 |
825 |
1,238 |
165 |
165 |
454 |
83 |
825
|
|
|
Dividend
(%) |
20.0 |
15.0 |
10.0 |
10.0 |
15.0 |
2.0 |
2.0 |
5.5 |
1.0 |
10.0
|
|
|
Tax
on Dividend |
- |
- |
- |
- |
- |
17 |
17 |
45 |
18 |
84
|
|
B |
FINANCIAL
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
Equity
Capital |
8,254 |
8,254 |
8,254 |
8,254 |
8,254 |
8,254 |
8,254 |
8,254 |
8,254 |
8,254 |
|
|
Long
Term Loan including |
|
|
|
|
|
|
|
|
|
|
|
|
Interest
Accrued and Due |
68 |
34 |
2,513 |
265 |
260 |
251 |
341 |
329 |
315 |
201
|
|
|
Gross
Block |
16,556 |
17,167 |
20,853 |
22,891 |
24,309 |
25,201 |
25,485 |
27,440 |
26,985 |
27,197
|
|
|
Cumulative
Depreciation & |
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill
Written-off |
11,118 |
11,442 |
11,816 |
12,626 |
13,363 |
14,175 |
15,025 |
15,941 |
16,413 |
17,311
|
|
|
Inventories |
3,872 |
5,199 |
4,436 |
4,844 |
5,462 |
7,026 |
4,883 |
7,169 |
5,177 |
6,523
|
|
|
Debtors |
915 |
705 |
2,268 |
142 |
1,888 |
1,071 |
1,001 |
605 |
1,100 |
906
|
|
|
Working
Capital |
4,341 |
2,126 |
4,493 |
4,632 |
5,569 |
7,669 |
7,627 |
10,059 |
11,377 |
12,156
|
|
|
Capital
Employed |
9,779 |
7,850 |
13,530 |
14,897 |
16,514 |
18,695 |
18,087 |
21,558 |
21,948 |
22,042
|
|
|
Net
Worth |
9,839 |
10,555 |
11,983 |
14,943 |
18,821 |
19,071 |
19,125 |
20,734 |
20,951 |
21,661
|
|
C |
OTHER
STATISTICS |
|
|
|
|
|
|
|
|
|
|
|
|
Number
of Employees |
1,696 |
1,697 |
1,699 |
1,654 |
1,629 |
1,589 |
1,555 |
1,533 |
1,501 |
1,455
|
|
|
Value
Added |
7,704 |
7,703 |
7,934 |
9,175 |
13,716 |
5,973 |
6,414 |
9,959 |
6,797 |
8,846
|
|
|
Value
Added per Employee |
4.54 |
4.54 |
4.67 |
5.55 |
8.42 |
3.76 |
4.12 |
6.50 |
4.53 |
6.08
|
|
|
Value
Added per rupee of |
|
|
|
|
|
|
|
|
|
|
|
|
Employee
Remuneration (Rs) |
7.49 |
6.13 |
5.85 |
5.91 |
7.79 |
3.16 |
2.69 |
3.56 |
2.24 |
2.56 |
|
|
|
|
|
|
|
|
|
|
|
|
|
