BPCL will give buyers ready access to 15.3 per cent of India’s oil refining capacity and 22 per cent of the fuel market share in the world’s fastest-growing energy market.
BPCL operates four refineries in Mumbai (Maharashtra), Kochi (Kerala), Bina (Madhya Pradesh), and Numaligarh (Assam) with a combined capacity of 38.3 million tonnes per annum, which is 15.3 per cent of India’s total refining capacity of 249.8 million tonnes.
While the Numaligarh refinery will be carved out of BPCL and sold to a PSU, the new buyer of the company will get 35.3 million tonnes of refining capacity. BPCL also owns about 16,309 petrol pumps and 6,113 LPG (liquefied petroleum gas) distributor agencies in the country. Besides, it has 51 LPG bottling plants.
The company distributes 22 per cent of petroleum products consumed in the country by volume as of March this year and has more than a fifth of the 256 aviation fuel stations in India.
BPCL has a market capitalisation of about Rs 97,247 crore and the government stake at current prices is worth over Rs 51,500 crore.
The successful bidder will also have to make an open offer to other shareholders for acquiring another 26 per cent at the acquisition price.
The government has appointed Deloitte Touche Tohmatsu India LLP as its transaction advisor for the strategic disinvestment process.
The government of India is proposing strategic disinvestment of its entire shareholding in BPCL comprising of 114.91 crore equity shares, which constitutes 52.98 per cent of BPCL’s equity share capital, along with transfer of management control to a strategic buyer (except BPCL’s equity shareholding of 61.65 per cent in Numaligarh Refinery Ltd), the notice inviting offer said.
The bidding will be a two-stage affair, with qualified bidders in the first EoI phase being asked to make a financial bid in the second round.
Public sector undertakings (PSUs) are not eligible to participate in the privatisation, the offer document said.
Any private company having a net worth of $10 billion is eligible for bidding and a consortium of not more than four firms will be allowed to bid, it said.
According to the bidding criteria, the lead member of the consortium must hold 40 per cent stake and others must have a minimum net worth of $1 billion. Changes in the consortium are allowed within 45 days, but the lead member cannot be changed, it added.
Privatisation of BPCL is essential for meeting the record Rs 2.1 lakh crore target BJP Party led finance minister has set from disinvestment proceeds in the budget for 2020-21.
BPCL has recored turnover of 284,382.95 Crores Rs during 2019-2020 and 337,622.53 Crores Rs during 2018-2019 and 277,270.54 Crores Rs during 2017-2018
BPCL has reported net profit 2,683.19 Crores Rs during the years 2019- 2020 and 7,976.30 Crores Rs during the year 2018-2019 and 8,039.30 Crores Rs during the year 2017- 2018