M A I N   N E W S

Reliance bags govt stake in IPCL

New Delhi, May 18
India’s largest petrochemical company Reliance Industries today won a keenly contested race for acquiring 26 per cent government stake in Indian Petrochemical Corporation Limited (IPCL), quoting a price of Rs 1490.84 crore.

Reliance bid Rs 131 per share for over 6.45 crore equity shares (26 per cent) to win India’s second largest petrochemical company, Disinvestment Minister Arun Shourie told reporters after a meeting of the Cabinet Committee on Disinvestment (CCD) here.

The other two companies in the fray — Indian Oil Corporation (IOC) and Nirma — bid lower than the Rs 845.5 crore (Rs 131 per share) reserve price fixed by IPCL disinvestment adviser Warburg.

State-run refiner IOC put Rs 826 crore at Rs 128 per share while detergent maker Nirma bid Rs 711 crore at Rs 110 per share, Shourie said.

Acquisition of stake in the Rs 5,800-crore IPCL, which owned three petrochemical complexes at Vadodara, Nagothane near Mumbai and Dahej in Gujarat, would take the market share of Reliance Industries to on unbeatable level of over 80 per cent.

The government, which presently had 59.95 per cent equity in IPCL, has decided to offload 51 per cent stake in two phases. It would transfer management control to Reliance for 26 per cent stake initially and the new partner would have the right of refusal over the remaining 25 per cent equity.

IPCL, which had reserves and surplus of Rs 2946.1 crore as on March 31, 2001, posted a net profit of Rs 56 crore on sales of Rs 3370.9 crore during the first nine months of 2001-02.

IOC put a brave front on losing IPCL saying the temporary setback would not affect its plans to enter petrochemicals business.

Senior IOC officials said the company had detailed plans to foray into petrochemicals business, including construction of a Rs 4,200 crore petrochemical complex at Panipat and acquisition of Haldia Petrochemicals Limited.

Coming after Reliance Industries’ failure to acquire VSNL and IBP, acquisition of India’s second largest petrochemical company would provide a major fillip to its corporate image and core business of petrochemicals. PTI