IOC will later offload 10 per cent to Lubrizol Corporation of the US for Rs 24 crore which will result in both companies holding 50 per cent each in the venture. Sources say that the finance ministry has already okayed the price for the deal.

The entire process of transfer of ownership in Lubrizol India from the government to IOC has lasted nearly a year. I-Sec, which had been hired by IOC, made an estimate of around Rs 700 per share which would have meant an outgo of Rs 70 crore. The Government was, however, not too happy with the estimate and roped in Enam Financial and IDBI to make a fresh valuation. This is the price IOC will now have to pay which is almost double that of the I-Sec estimate.

There have, incidentally, been unconfirmed reports that the Oil and Natural Gas Corporation is quite keen on participating in the venture as a third partner. This would obviously mean that IOC would need to offload a part of its stake to ONGC but, in the opinion of experts, this seems an unlikely possibility. The rumour stems from the fact that the two oil companies have kicked off the process of participating in a series of petro-related activities both here and abroad.

ONGC, it may be recalled, was among the initial contenders to buy out the Government's holding in Lubrizol India more than two years ago. The venture was then to have been recast as a 50:50 tieup between the oil PSU and Lubrizol Corporation. Delays occurred with a change in Government at the Centre coupled with obstacles on valuation of the scrip. Finally, ONGC withdrew from the race and IOC stepped in even while there were other candidates like Cochin Refineries and the Indian Petrochemicals Corporation.

The top brass of IOC and Lubrizol Corporation met in the UK to thrash out various modalities of the joint venture which included the new board of directors, scope of operations. This time around, there is no reason for the Government to delay the sale process as it is keen on getting on with the process of meeting its disinvestment target of Rs 10,000 crore for 1999-2000.

The company was incorporated in 1966 and its manufacturing unit is situated at Turbhe village in Navi Mumbai. It has a second unit for manufacture of extreme pressure additives at Taloja in Raigad district. Lubrizol India makes and markets additive systems for automotive and industrial lubricants and also develops other speciality chemicals for the petroleum industry. The latest report of the petroleum ministry states that the company reported a turnover of around Rs 363 crore in 1997-98.