New Delhi: With the BPCL privatisation plan moving at snail's pace, the Central government is believed to have dumped its plan to sell its 100 percent stake in the state-run oil retailer, and is instead considering inviting bids for the sale of 20-25 percent stake, said a report by Reuters. Quoting sources, the report said that after failing to attract suitors for the Bharat Petroleum Corporation Ltd (BPCL) since the announcement of its disinvestment plan in 2019, the government is now considering a change in its plan. The sources added that discussions about the plan were in early stages.
The government owns 52.98 percent stake in BPCL and was planning to sell all of it to a strategic investor. However, despite showing interest in the deal initially, sources said that both Rosneft and Saudi Aramco did not bid.
One of the sources was quoted as saying that BPCL privatisation prospects were hit by inconsistent policies on petrol and diesel prices. There were many issues but most recently petrol prices not being raised for four months between November and February were presumed due to elections by the government," the official said. The current discussions began after all bidders had withdrawn from the process last month, the report said.
Private equity firm Apollo Global Management and oil-to-metals conglomerate Vedanta Group were the final bidders, said one of the two sources quoted above. He added that even part sale of the government's stake in BPCL is unlikely to be completed in this financial year.
The government has announced an ambitious PSU privatisation plan under which it plans to retain management control in bare minimum number of PSUs in strategic sectors. The privatisation of BPCL was a centrepiece in the government's privatisation plan as it would have given the buyer access to 23 percent of India's growing fuel market. However, experts believe that the volatility in the global crude oil prices, coupled with the global capital shifting away from fossil fuel are some of the main reasons why the government's ambitious privatisation plan for BPCL could not take off.
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