MSTC, the company that conducts e-auctions for Tirupati hair, is set to bag the contract for disposing of plants and machinery of three Central Public Sector Enterprises (CPSEs) – HMT Watches, HMT Chinar Watches and HMT Bearing – that are slated to be closed down soon.

“The plan is to appoint MSTC for auction of plant and machinery of these CPSEs,” a senior government official told BusinessLine . MSTC has successfully completed e-auction of coal (that fetched over ₹2 lakh crore) as also for re-gassified liquefied natural gas or RLNG (that helped in allocation in over 8 MMSCMD to stranded gas-based power plants), among others.

The auctioneer’s appointment will take place once the Cabinet approves the individual proposal for closure of the three companies. The Cabinet is expected to consider the proposal soon.

The Centre initially planned to close down five chronic loss-making companies, comprising three HMT companies, Tungbhadra Steel and Hindustan Cables. However, the plan to close Hindustan Cables has been put on hold for the ‘time being’.

Asset sales in all the five companies is estimated to fetch around ₹20,000 crore. These companies also own significant land. The official said these companies have two categories of land – acquired land and land given by States on lease-hold basis. Under the new land use policy, leasehold land will be returned to the State government, while land owned by the closed CPSE will be available for other CPSEs.

Last week, Heavy Industry Minister Anant Geete said that the five sick CPSEs had been non-functional since 2007. About ₹4,000 crore has been spent so far toward the salary and wages.

“Since there was no productive outcome and it was a burden on the Central exchequer, we decided to close them down. The cost of closing down (these units) is only about ₹1,400 crore,” he mentioned. The five sick units employ about 2,800 employees, for which an attractive Voluntary Separation Scheme will be offered.

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