Bharat Petroleum Can Be Sold For Rs 90,000 Crore? Vedanta Puts This ‘Pricetag’ On Bharat Petroleum
In recent times the government of India has been trying aggressively to sell some of the assets it owns. This has been in line with PM Modi’s vision of – ‘Government has no business of being in Business.’ BPCL has been the dark horse government has been trying to sell for a long time now.
The wheels of arduous process finally might be starting to move as Vedanta group has shown some interest to buy the company at a fair price.
Vedanta group tags $12 Billion for BPCL
According to the chairman of Vedanta Group, Anil Agarwal, the company is willing to spend $12 billion to acquire India’s state-owned refiner Bharat Petroleum Corp. The BPCL is among the nation’s biggest assets and has faced delays in completion. The chairman clarified that the Vedanta group is not going to bid aggressively, but is willing to put the right price.
“The market cap of the company is about $11 billion to $12 billion, so this is the amount of investment we’re looking at,” the chairman added further. The commodities tycoon expects India to open the bids for BPCL in March.
BPCL struggles to find Buyers
Since its inception, India’s plan to privatize BPCL has run into rough weather with bidders struggling to find partners and spread their financial risks for the big-ticket acquisition. India was expecting global oil majors to team up with investment funds to participate in the sale. Notably, some bidders are finding it difficult to invest due to global sustainability rules that make it tougher for them to make large investments in fossil fuels.
The sale of BPCL is crucial for the government because it will help in raising revenues for its spending programs. It’s already missed a September deadline to complete the sale of its entire 53% stake in BPCL. The company’s current market capitalization is around 848.27 billion rupees ($11.4 billion).
Apart from, Vedanta Group, private equity firms Apollo Global Management and I Squared Capital have also shown interest in acquiring the government’s holding in BPCL, the second-biggest state refiner in India.