BPCL Investment Withdrawal: The privatization of state-owned petroleum company Bharat Petroleum Corporation Limited (BPCL) has come to a halt. Two bidders withdrew due to lack of clarity on fuel prices, leaving only one bidder in the race to buy the company. The government plans to sell its total 52.98 per cent stake in BPCL and has invited expressions of interest from bidders in March 2020.
Do you know why the withdrawal process has stopped?
Until November 2020, let you know that there are at least three bids, but after others have withdrawn their offers, there is now only one bider left in the race to take over BPCL. Sources said, “We have only one bidder and this does not mean that a bidder has imposed his own terms. So the investment withdrawal process is currently on hold.”
Not getting buyers
The second largest public sector oil refining and fuel marketing company in India could not find many buyers. The main reason for this is the lack of clarity on domestic fuel prices. Public sector fuel retailers are selling cheaper petrol and diesel. This makes it harder for private sector retailers to sell fuel at a loss or lose market share.
Withdraw bids
Anil Agarwal’s Vedanta Group and American venture funds Apollo Global Management Inc. and I Squared Capital Advisors have expressed interest in acquiring a 53 per cent government stake in BPCL. However, both global investors later withdrew their bids.
The government is looking at privatization in a new way
The sources said the government had not invited financial bids. Once the terms and conditions of the share purchase agreement have been finalized, the government is required to invite financial bids. There is talk that the government is now considering a fresh look at the privatization of BPCL as well as the revision of sales terms.
To this extent Vedanta Chairman said
Another source said that considering the geo-political situation and energy changes, the government could provide a 26 per cent share with management control. The government has not made any official announcement on the withdrawal of the BPCL disinvestment process. Vedanta chairman Anil Agarwal said the government had withdrawn its offer to sell its stake in BPCL and would come up with a new plan.
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2022-05-18 15:19:34