The New Delhi Municipal Council (NDMC) has selected SBI Cap, which was the Centre’s advisor for the coal auctions, to be its transaction advisor for the auction of the iconic Taj Mansingh hotel.
“We have got an in-principle approval from the council to take on board SBI Capital Markets Ltd (SBI Cap) as our transaction advisor for the auction of hotel Taj Mansingh. It will guide us through the entire process,” newly-appointed NDMC Chairman Naresh Kumar said.
SBI Cap is a wholly-owned subsidiary of the country’s largest bank, SBI. It offers advice on investment and projects along with consultancy on funds mobilisation. It has also assisted the mining ministry with auction processes initiated by the government.
Hotel Taj Mansingh, a property owned by NDMC, was given to Tata-owned Indian Hotels Company Ltd (IHCL) on lease for 33 years. The lease ended in 2011 and the company has been given seven temporary extensions since then on various grounds.
IHCL was last week given another three-month extension for operating the hotel with NDMC saying it was planning to complete the auction of the property by September. The current lease agreement, which expires on June 30, has now been extended till September 30.
“We plan to complete the auction process within this time frame,” Kumar said.
NDMC, which works under the administrative control of the Union Home Ministry, had got a nod to auction the hotel in March this year.
Maintaining that it does not have the expertise to go for an auction process of this level and complexity, NDMC had earlier invited bids from process managers to assist it with the auction after the consultant for the project, Ernst and Young, had pulled out from the process in November last year.
NDMC had also sought guidance from Coal Ministry on the matter of auctions.
Two years ago, when NDMC decided to auction the property, IHCL had approached Delhi High Court seeking a stay on the process. However, the company did not get the sought-for stay order from the court.