Mumbai, Feb 19: Reliance Petroleum Ltd (RPL) and Indian Oil Corporation (IOC) are believed to have evinced keen interest in going it alone in their bid for IBP. Industry sources tracking the disinvestment process said both the companies have shown strong interest in picking up a stake individually. The last date for submission of bids is February 28.While industry experts do not rule out the possibility of a joint bid by the duo, indications are they can only do so after the formation of their marketing joint venture which is yet to be approved by the government.
Significantly, market speculation pegs the valuation at over Rs 800 crore, though Reliance's official spokesman declined to comment either on a potential bid or on the valuation.
The government of India (GoI) has decided to reduce its stake in the oil company from 59 per cent to 26 per cent. The strategic investor will be given 39 per cent stake in the company. The tenders will be finalised by March 31.
The decision of the GoI to disinvest 33.58 per cent in IBP has seen keen interest from oil companies, Indian as well as multinationals. Some of the companies reported to be in the fray include PSUs like Hindustan Petroleum Corporation Ltd (HPCL) and Bharat Petroleum Corporation Ltd (BPCL).
According to sources, Reliance would be seriously considering the proposal as it will need a strong retailing facility to sell its products from its 27-tonne refinery at Jamnagar.
The disinvestment of IBP would be the first case involving global bidding undertaken in the petroleum sector by the GoI as a run-up to deregulation scheduled in April 2002.
The pre-qualification for taking part in the disinvestment is that the company should have a group net worth in excess of Rs 950 crore and have significant experience and presence in oil and gas sector. Apart from this, companies should have plans to invest Rs 2,000 crore in exploration and production, refinery, pipelines and terminals. Earlier, the ministry of petroleum had stipulated that companies should have already invested Rs 2,000 crore in infrastructure but it has been scaled down. The pre-qualification now states that companies having plans for investment in infrastructure would be considered. IBP has a chain of over 1,500 retail stations all over India.
The strategic partner may be required to make a public offer to acquire further shares of IBP in accordance with the regulations of Securities and Exchange Board of India (Sebi), said sources. ased on expressions of interest, companies would be pre-qualified for the bidding process and asked to submit detailed financial and technical bid later.
Copyright © 2001 Indian Express Newspapers (Bombay) Ltd.
