After the Life Insurance Corporation of India’s IPO, the government is contemplating to sell part of Bharat Petroleum. Earlier the government had planned to sell its entire stake in Bharat Petroleum Corp Ltd. Is.
The government may invite bids for a 20%-25% stake in BPCL, rather than an outright sale of its entire 52.98% stake, two officials told Reuters. The report said that initially the government had targeted to raise $8 to 10 billion by selling its entire stake in BPCL.
The plan was prepared four years ago
Having drawn up the plan four years ago, the government hoped that major players such as Russia’s Rosneft might be interested, but Rosneft and Saudi Aramco did not bid, as low oil prices and weak demand at the time hampered their investment plans. was stopped.
There will be no sale this year
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 another reason for this is that there have been many changes in the prices of petrol and diesel, which are not fair for the current market.
impact of election
Elections in five states including Uttar Pradesh were also one of the reasons, due to which there was no change in the prices of petrol and diesel from November to February. However, after the election results, the prices have increased since March. Both the officials said discussions have started after all the bidders withdrew from the process last month.
deal with Apollo
Private equity firm Apollo Global Management and oil-to-metal conglomerate Vedanta Group were the final bidders, officials said. Sarkar, Vedanta and BPCL did not immediately respond to emails seeking comment. The Apollo Group declined to comment thereafter. In such a situation, going back on the full stake sale of BPCL is a sign of slow progress in the privatization plans of the government.
No stake will be sold this financial year
Significantly, in 2020, Finance Minister Nirmala Sitharaman had announced plans to privatize most government companies, including banks, mining companies and insurance companies. But so far it has been very slow. 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.