Tata BP Lubes amalgamated into CIL

Our Corporate Bureau

Mumbai, Sept 20: Tata BP Lubricants India Ltd has been amalgamated into Castrol India Ltd (CIL), following Tata group’s decision to exit the lubricants business. The amalgamation will be effective from January 1, 2001, after receiving all necessary approvals.

The board of CIL, at a meeting held on Thursday, approved a proposal to this effect. Tata BP Lubricants was originally formed as a joint venture between the Tata Group and BP-Amoco of Mauritius.
After the completion of the transfer, BP Mauritius’ stake in Tata BP will increase to 99 per cent. According to a CIL press release, the Tata group and BP recently concluded negotiations for the transfer of the stake held by the Tata group and BP Mauritius. The press release said that the amalgamation of the two companies would provide several opportunities for savings through operational synergies.

The exchange ratio has been pegged at two shares of face value of Rs 10 each of CIL for 19 shares of face value of Rs 100 each each of Tata BP. The exchange ratio is based on an independent valuation done on behalf of both companies jointly by PriceWaterhouseCoopers and SB Billimoria & Co, the press release added. The companies would approach the High Court to convene the necessary meetings required to carry the process forward.

The option of amalgamating Tata BP into CIL was under consideration for quite sometime. Earlier, a Castrol official had said that the Tata name will be gradually phased out and the company had plans to launch BP-branded products in India during the third quarter of this year. CIL would continue its relationship with the Tatas through a strategic alliance spanning commercial vehicle oils and passenger car motor oils, official added.

Tata BP’s products range includes lubricants, gear oils, grease and hydraulic oils of superior performance and value. The company had a market share of about 10 per cent in the commercial vehicle segment. It has a national distribution network with over 23 depots and 250 distributors.