RasGas can buy Petronet pie via FCCBs

Petronet LNG said Qatar's RasGas can buy stake in the Indian company by subscribing to its proposed $100 million foreign currency convertible bond issue.

Petronet managing director Prosad Dasgupta said post-conversion, the FCCB issue will amount to 7.5-8.0 per cent of the company's expanded capital base.

"They (RasGas) are our strategic partners, and will be given the first right of refusal (to convert to equity) if they subscribe to our FCCB issue. I am not issuing any vanilla capital for them," Dasgupta said.

The Qatar company is the sole supplier of gas to Petronet LNG. Dasgupta said five merchant bankers have evinced interest to lead manage the FCCB issue.

"We have asked Citibank, HSBC, ICICI Securities, ABN Amro and JP Morgan to submit their final proposal by May 20, depending on which we'll finalise our issue manager," Dasgupta told CRISIL MarketWire.

Petronet has convened its annual general meeting on June 14 to take shareholders' approval for the $100 million issue, fully convertible into equity shares within five years of the issue. The FCCB issue is meant to fund the construction of 2.5-million-tonne liquefied natural gas terminal at Kochi.

At a meeting with Petroleum and Natural Gas Minister Murli Deora, Qatar's Minister for Industry and Energy Abdullah bin Hamad Al-Attiyah had said RasGas was keen on picking up a stake in Petronet LNG.