One central theme is that if the facility is highly capital intensive & the private sector doesn't have the money to chip in & the goods & services are vital, then the establishment gets a green signal. Such a decision is taken for core sectors like steel, distribution of energy products, its prospecting, ship building etc.at the macro level.
If the PSU finds that the demands are huge, then it may go in for joint venture with an overseas govt. or an allied company, looking into the interests of both the countries.
In the service sector for e.g if similar but quite smaller allied units are to be put on leash - for various reasons - then with the govt. fiat it will merge all these smaller units into the main company. The advantages are - stream lined services, out reach into rural areas, & turning around some of the loss making units.
On Decision Making, available at https://www.researchgate.net/publication/266477995_On_Decision_Making, argues that decision making is a stream of inquiry, not an event. Decision-driven organizations design and manage it as such: they match decision-making styles to appropriate techniques and, wherever possible, encourage parties to play roles rife with dissent and debate; decision rights are part of the design.
I can refer you to three classic sources on decision making by Presidents of the U.S. which can be applied to executive decision making in the public and private sectors. All of them discuss decision making as a process: Richard Neustadt, Presidential Power; Graham Allison, The Essence of Decision; and Irving Janis, Groupthink.
Are you looking on the macrolevel theories (explaining the decision-making within public policies) or microlevel concepts (explaining the decision-making as a managerial process within public sector organizations)?
According to my experience in Indonesia, decision making is an art and a game. As an art if many peoples participate in the process. We must make them understand why we chose a kind of policy. It is difficult. Peoples ussually have different purpose. Decision making also as a game if the process done by an politician.