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Privatization of BPCL: Withdrawal of BPCL Investment: The sale of India’s top assets is delayed as suitors strive for partners

People familiar with the matter say India’s Bharat Petroleum Corporation’s privatization program faces bad weather, with bidders struggling to find partners and spread economic risks.

People say three suitors, Bedanta Group, Apollo Global Management and I Squared Capital, are in talks with the world’s energy giants, sovereign wealth funds and pension funds, but haven’t been able to identify partners. rice field. The deliberation is private. Some bidders have found it difficult to invest due to sustainability rules that make it difficult to buy stock in oil refiners, some said.

The new hurdle to sell all of the government’s shares could ease some of the euphoria caused by the recent sale of Air India to Tata Group and slow down the country’s largest privatization impetus. .. The sale of a state-owned refiner and fuel retailer would have earned about $ 13 billion for excequer and other shareholders.

Following a Bloomberg News report, BPCL shares fell 3.5% to Rs 431.7 at Mumbai’s closing price, the highest in more than a month.

Huge price tags mean that bidders and the Government of India want a consortium with stronger technical and financial strength for trading, people said.

Treasury and BPCL spokesmen declined to comment immediately, but Apollo Global declined. Representatives from Vedanta and ISquared did not reply to emails asking for comment.

India still wants oil majors to take part in competition for the biggest sale

Global promotion of green energy and pressure from investors to reduce emissions has prevented companies from making large investments in fossil fuels. Pandemics and their consequences also slowed down the process and discouraged global companies from investing heavily in traditional fuels.

In the case of BPCL, people said due diligence was delayed because bidders waited for new partners to join. This could overturn the federal government’s goal of selling its entire 53% stake in BPCL by the end of this fiscal year in March, when it was planning a fiscal bid next month.

BPCL granted bidders virtual access to financial data in early April, but has progressed beyond the exchange of several questions and initial discussions with state-owned company management over the past six months. Is not …

“Bidders perform due diligence, but uncertainties about the complexity of the process, including the bidder consortium and ratings, can lead to potential delays,” Fitch Ratings said in a commentary last month. Said. “Further Covid-19 waves and the risk of global oil and gas companies focusing more and more on energy conversion add further uncertainty to the timing and valuation of potentially large acquisitions in this sector. We believe it will bring. ”

BPCL has three refineries capable of processing approximately 700,000 barrels of oil per day, a marketing network of approximately 19,000 fuel stations, and approximately 6,200 liquefied petroleum gas distributors.

Privatization of BPCL: Withdrawal of BPCL Investment: The sale of India’s top assets is delayed as suitors strive for partners

Source link Privatization of BPCL: Withdrawal of BPCL Investment: The sale of India’s top assets is delayed as suitors strive for partners

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