Vedanta Group plans to spend $12 billion to acquire the state-owned refiner Bharat Petroleum Corporation Limited (BPCL), reports Economic Times.
So far, prospective bidders for BPCL have struggled to find partners to complete this deal and spread their financial risks for the big-ticket acquisition.
Initially, there were expectations of global oil companies combining with investment funds to take part in the sale. However, according to the report, 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 fuel.
In an interview in Saudi Arabia’s Riyadh on Wednesday (12 January), Vedanta Group’s chairman Anil Agarwal said, “We’re not going to bid aggressively, but we will 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.”
Besides Vedanta, private equity firms Apollo Global Management and I Squared Capital have also showed interest in acquiring the government’s holding in the oil refiner.
The central government, according to the commodity tycoon experts, is likely to open the bids for BPCL in March 2022. It should be noted that the government previously missed the deadline of September 2021 by when it had intended to sell its entire 53 per cent stake in the refiner.