IOC plans $2.5-billion share sale
Ahmedabad   07-Oct-2010

IndianOil, the nation's second-biggest refiner, plans to sell $2.5 billion of stock to lower debt and fund new plants, chairman Brij Mohan Bansal said. "We are in the process of appointing the lead managers and bankers," Bansal said in an interview in New York. Government approval of the plan is expected soon and the company plans to sell shares in January, he said.

Bansal said the funds will help IndianOil reduce its Rs 45,000 crore ($10.1 billion) debt as it builds a new refinery in Orissa state and looks for possible overseas ventures. The sale will take place along with a dilution of the 79% stake held by the government, which in January said it wants to cut its investments in the nation's companies to raise funds for development and shrink the budget deficit.

The refiner's long-term debt has a Baa3 rating by Moody's Investors Service, the lowest investment grade ranking.