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Shourie blasts Shiv Sena over divestment

Divestment Minister Arun Shourie on Saturday charged Shiv Sena, an NDA coalition partner, with 'doublespeak' on the divestment issue saying that the party had approached him on privatisation of a government hotel in Mumbai.

Accusing the Shiv Sena of seeking favours for hotelier Ajit Kerkar for the acquisition of Centaur Juhu hotel in Mumbai, he told reporters that the ally had approached him repeatedly when Kerkar was unable to pay for the hotel and the government did not encash the bank guarantee.

"Ask the Shiv Sena people who rang me up four times to say that the hotel should be sold," Shourie said when asked about the Sena's reported stand that government had undersold the Centaur airport hotel.

After acquiring the Centaur Airport Hotel, Mumbai, for Rs 83 crore (Rs 830 million) from government last year, Batra Hospitalities recently sold the property to the Sahara Group reportedly for over Rs 100 crore (Rs 1 billion), thus generating queries in some quarters about the valuation process adopted by the government.

Asked if the resale of the hotel had been in violation of lock-in period, Shourie clarified that since it was an outright sale there was no lock-in period prescribed in the transaction document that could bar transfer of property for a stipulated period.

Shourie said that the lock-in period would vary from case to case, but these provisions were cleared by Cabinet Committee on Divestment, Core Group of Secretaries and Inter Ministerial Group on divestment.

When queried further as to whether the deal violated any specific provision of the share purchase agreement, Shourie said he would have to study the agreements.

Asked about the valuation of the resale, Shourie cited the Supreme Court judgement in Balco case saying that valuation is the price which the buyer was willing to pay.

On the issue of new owner abiding by the commitments to protect employees, he said that commitments given to government would have to be adhered to stating that they would not only get the assets but the liabilities also.

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