The government today approved a Rs 200-crore revival package for sick public sector unit Scooters India (SIL), sources told NDTV Profit.
After the government shelved a plan to sell its entire stake in SIL, the Department of Heavy Industry had proposed a revival package of more than Rs 200 crore for the company, PTI reported earlier, citing sources.
The department had consulted the Board for Reconstruction of Public Sector Enterprises (BRPSE) which examined the case and later suggested a revival package.
While cash assistance implies equity infusion, grants and loans, non-cash assistance includes waiving interest, government loan and conversion of loan into equity.
In 2011, the Union Cabinet had given approval to divesting government's entire 95.38 per cent stake in SIL to a private player through strategic route (outright sale). But the Department of Heavy Industry put on hold the strategic sale.
The automobile company, which has about 1,200 regular employees, has been incurring losses since 2002-03. In March 2009, the company was declared sick.
Incorporated in 1972, SIL initially manufactured scooters under the brand name Vijai Super for the domestic market and Lambretta for the overseas markets.
Later, it ventured into the three-wheeler segment with the Vikram brand. In 1997, it stopped two-wheeler production and is now engaged in the manufacture and marketing of only three-wheelers. SIL's net loss (before tax) stood at about Rs. 20 crore during the 2011-12 fiscal year.
With inputs from PTI