bpcl: BPCL selloff delayed as bidders strive for partners

NEW DELHI: The government’s plan to privatise Bharat Petroleum (BPCL) has run into rough weather with bidders struggling to find partners and spread their financial risks, according to people familiar with the matter. The three suitors – the Vedanta Group, Apollo Global Management and I Squared Capital – are talking to global energy giants and sovereign and pension funds, but haven’t been able to finalise partners, the people said, asking not to be identified as the deliberations are private. Some bidders are finding it difficult to invest due to sustainability rules that make it tougher for them to buy a stake in an oil refiner, some of the people said. The fresh hurdle to sell the government’s entire stake could temper some of the euphoria generated by the recent sale of Air India to the Tata Group and slow down the country’s biggest privatisation drive. The sale of the state-run refiner-cum-fuel retailer would have fetched about $13 billion for the exchequer and other shareholders. BPCL shares fell 3.5% to Rs 432 on the BSE, the most in more than a month, after the Bloomberg report. The massive price tag means bidders as well as the government want a consortium with stronger technical and financial muscle for the transaction, the people said. Spokesmen at the finance ministry and BPCL weren’t available for a comment, while Apollo Global declined to comment. Representatives at Vedanta and I Squared didn’t reply to emails. A push toward green energy and pressure from investors to slash emissions is holding back companies from making large investments in fossil fuels. Bloomberg

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