OIL to file papers for IPO this month

State-run Oil India (OIL) will file a draft red hearing prospectus (DHRP) this month for an initial public offering (IPO) in February 2008.

The company intends to offload 10 per cent equity via the issue.

"We will file the DHRP this month," M R Pasrija, chairman and managing director, OIL told reporters on the sidelines of the India-Africa Hydrocarbon Conference here.

OIL, which has seven full-time directors, will appoint an equal number of independent directors to comply with the corporate governance norms before filing the prospectus.

"We are targeting for the IPO in February," Pasrija said.

Alongside the IPO, the government plans to sell 10 per cent stake to Indian Oil, Bharat Petroleum and Hindustan Petroleum.

"While the proceeds of the IPO will accrue to OIL, those from the stake sale to IOC, BPCL and HPCL would go to government," he said.

Currently, the government owns 98.17 per cent stake in OIL. The remaining stake is with its employees. After the IPO and stake sale, government's stake in the company will come down to 78.43 per cent.

OIL proposes to issue 26.45 million shares in the IPO. Of this, 2.4 million will be given to its employees.

The company currently produces 3.3 million tonnes of crude oil and seven million standard cubic metres a day of gas from fields located mostly in the north east.