Don’t miss the latest developments in business and finance.

ONGC, IOC, GAIL keen to buy ADB stake in Petronet

Image
Press Trust of India New Delhi
Last Updated : Jan 20 2013 | 9:23 PM IST

In response to ADB's offer to exit the nation's largest liquefied natural gas importing company, three out of the four state-run promoters of Petronet expressed interest in buying ADB's entire equity, industry sources said.     

Bharat Petroleum, which like IOC, ONGC and GAIL also holds 12.5 per cent stake in Petronet, has, however, not responded.     

The three firms in separate letters to Manlia-based ADB suggested that the multilateral lending institution sells 1.3 per cent equity shares each to IOC, ONGC, GAIL and BPCL who have the first right of refusal in the event of the multinational firm exiting from Petronet.     

However, if the state-run promoters are not allowed to raise stake in the company for fear of it becoming a public sector unit, IOC suggested selling ADB's shareholding to the public.     

Sources said the state-run firms were against giving a "backdoor" entry to someone like steel tycoon Lakshmi N Mittal, who is keen on getting a foothold in the LNG business.     
Petroleum Secretary M S Srinivasan, who is also the chairman of Petronet, is believed to be backing Petronet LNG's proposal of getting a third party like Mittal or Chevron Corp of US in a stake for LNG barter deal.     

IOC, GAIL, ONGC and BPCL together hold 50 per cent stake in Petronet, while Gaz de France holds 10 per cent. These firms have the first right of refusal over ADB's stake. ADB is likely to exit Petronet by year end as its internal regulations prohibit it from being a debt financier as well as equity holder in the same company.

Also Read

First Published: Jun 18 2008 | 6:25 PM IST

Next Story