New Delhi : India is looking to sell up to a quarter of the Indian government-run refiner Bharat Petroleum Corp Ltd after failing to attract claimants for the entire firm, two officials said, as the government’s disinvestment program runs slower than expected. Is.
New Delhi is considering inviting bids for a 20%-25% stake in BPCL, rather than an outright sale of its entire 52.98% stake, two government officials, who declined to be named, told Reuters. .
Officials said that discussions regarding the plan were at an early stage.
Initially, the government had targeted to raise $8-10 billion by selling its entire stake in BPCL. Having drawn up plans four years ago, it invited bids in 2020, hoping key players such as Russia’s Rosneft might be interested.
But Rosneft and Saudi Aramco did not bid, as their investment plans were curtailed by low oil prices and weak demand at the time.
Government officials said even the partial sale of BPCL is unlikely to be completed in this financial year as the process would take more than 12 months.
One of them said that the sales prospects were affected by inconsistent policies on petrol and diesel prices.
“There were many issues, but recently, petrol prices were not raised for four months between November and February as elections were anticipated by the government,” the official said.
Elections were held in India in February in five states, including Uttar Pradesh, and pump prices started rising from March 22, by which time Prime Minister Narendra Modi’s Bharatiya Janata Party had won four of the five states.
Both the officials said the ongoing discussions started after all the bidders withdrew from the process last month.
He said private equity firm Apollo Global Management and oil-to-metal conglomerate Vedanta Group were the final bidders.
Government, Vedanta and BPCL did not immediately respond to emails seeking comment. Apollo Group declined to comment.
The backlash on BPCL’s outright stake sale is a sign of slow progress in the government’s privatization plans.
In 2020, Finance Minister Nirmala Sitharaman announced plans to privatize most government companies, including banks, mining companies and insurance companies.
But little progress has been made, and both officials said the government has deferred plans this fiscal to sell any bank other than IDBI Bank, which is owned by Life Insurance Corporation of India. LIC hit the market on Tuesday after the government sold 3.5% stake.