Page 50 - Plastics Nuews October 2017

BuSINESS NEWS

ONGC to acquire HPCL in bulk or block deal

il and Natural Gas Corporation (ONGC) will acquire the the government's existing 51.11 per cent stake in HPCL
Ogovernment's 51.11 per cent stake in HPCL through a to ONGC "along with the transfer of management control,
bulk or block deal some time in November or December at which will result in HPCL becoming a subsidiary company
the prevailing market price.While the government is keen of ONGC". The terms of sale have been amended to state
that the deal, which would fetch it over Rs 33,000 crore at that "HPCL will continue to be a government company in
the current market price, is done in October, ONGC wants terms of section 2(45) of the Companies Act, 2013 and
time to raise the money required for the acquisition, a will continue to be controlled by the Government of India
senior government official said. Accrording to a report through ONGC under the administrative control of the
government's transaction advisor JM Financial and Ministry of Petroleum and Natural Gas".
legal consultant
Cyril Amarchand
Mangaldas
is preparing Saudi Aramco expands in
I n forma t ion India, launches new venture
Memo r andum
(IM) on Hindustan audi Aramco has launched its new Indian venture
P e t role u m Snear Delhi, a government statement said Sunday,
Corporation Ltd as the global oil exporter looks to tap rising demand
(HP CL) with and invest in the world’s third-biggest consumer. Oil
India's largest oil minister Dharmendra Pradhan, who jointly inaugurated
and gas producer, ONGC, in the next 7-10 days. ONGC has the local unit with Aramco chief executive Amin
appointed SBI Caps and the Citi Group as its merchant
bankers for the deal and Shardul Amarchand Mangaldas
as legal advisor, who would study the IM to arrive at a
valuation for the takeover of the country's third-largest
refining and oil marketing company. ONGC will do the
due diligence of HPCL's assets based on the IM and
publicly available information to arrive at the valuation.
Negotiations between ONGC and the government will
follow if the valuation is vastly different from the one
the government has arrived at.

The share purchase would happen through a bulk or block
deal at the prevailing market price, he said, adding that Nasser, said the move would help pave the way for
going by the pace of things, the deal could happen some “a strategic partnership in the hydrocarbon sector”
time in November or December. Both bulk and block deals between the two nations. Saudi Aramco through its
are done on stock exchanges. subsidiary Aramco Asia India established its formal
A block deal happens when a transaction involves a business presence in India last year, the statement
minimum quantity of 5,00,000 shares or a minimum value said. Aramco is investing in refineries in major markets
of Rs 5 crore between two parties. Such deal takes place to lock in customers ahead of its initial public offering
through a separate window at the beginning of trading (IPO) next year, and the India business, on top of sales,
hours for the duration of 35 minutes i.e. from 9.15 am will look for opportunities to take stakes in refining and
to 9.50 am in a price range of +1 per cent to -1 per cent petrochemical projects in the country. Saudi Arabia is
(plus or minus 1 per cent) of the ruling market price. The competing with Iraq to be India’s top oil supplier, with
Cabinet Committee on Economic Affairs (CCEA) had on July Iraq displacing it for a fifth month in a row in August,
19 granted 'in-principle' approval to the strategic sale of according to data compiled by Reuters.

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