The government has given a mandate to IDBI Capital Market Services Limited (ICMS) to carry on the process of divestment.

According to sources, the last date for submission of Expression of Interest by bidders is March 30, 2001. Post-divestment, the successful bidder will acquire majority shareholding and management control over TSPL.

Tungabhadra Steel is a medium-sized company engaged in the business of manufacturing equipment for hydel projects, agricultural and irrigation projects. The company credits itself of being the sole manufacturer of high-tech implements like sluice gates for dams and irrigation canals and other specialty equipment, which were earlier imported. At present, its principal business comprises manufacturing hydraulic gates, hoists, cranes and penstock pipes, catering to irrigation and hydel power sectors.

According to sources, various Indian companies aspiring for a base in southern India and foreign companies looking for a foothold in India are in the fray for the PSU. Sources also added that this being a small steel plant catering to niche market forms an ideal investment opportunity for any party, as the infrastructure and technical skills will offer a competitive advantage. Sources close to the disinvestment process pointed out that the decision to divest stake in the company, follows the government's policyto move away from manufacturing businesses.

TSPL began operations as a PWD workshop for Tungabhadra Dam to manufacture gates and hoists required for spillways, sluices and canal gates for the dam. For the first time, welding technology was introduced by the workshops in manufacture of gates instead of conventional riveting. However, after the completion of the dam, TSPL was incorporated as a joint undertaking of BYNL, Government of Andhra Pradesh and Government of Karnataka. In July 1986, BYNL was formed as a holding company of a multi- resource group and TSPL became its subsidiary, post the transfer of government's holding in TSPL to BYNL.Today, BYNL has six engineering units besides TSPL, ie. Bharat Heavy Plate and Vessels Ltd, Visakhapatnam, Bharat Pumps and Compressors Ltd, Allahabad, Bridge and Roof Company Ltd, Calcutta, Richardson and Cruddas, Mumbai and Triveni Structurals Ltd, Allahabad.