Kuwait keen to buy shares in IndianOil
New Delhi   28-Sep-2010

Oil-rich Kuwait is keen on buying a stake in IndianOil (IOC) if the government decides to sell its shareholding through a strategic divestment, oil minister Sheikh Ahmad Al-Abdullah Al-Sabah said on Monday.

“If government divests some stake through strategic sale, we are very interested in such a proposal,” he told reporters after a luncheon meeting with the IOC management here.

The government plans to sell its 10% stake in IOC this fiscal through a public offering, a route that is of little interest to Kuwait.

“It has to be strategic sale,” he said when asked if Kuwait Petroleum Corp. (KPC), of which he is chairman, or Kuwait Investment Authority, would been keen to buy IOC shares in the public offering.

KPC was one of the seven suitors for fuel retailing firm IBP Co. Ltd, in which the government sold its shareholding through a strategic sale in 2002. IOC outbid KPC, Royal Dutch Shell Plc. and Reliance Industries Ltd to buy IBP.

Al-Sabah said he had heard of government plans to sell its 10% stake in IOC through a public offering in the fourth quarter of current fiscal to raise Rs.7,000 crore.

While IBP’s 2,524 petrol pumps offered a company access to the fastest growing fuel market in Asia, a stake in IOC would give the firm a foothold in the nation’s largest refining and marketing company. IOC owns half of India’s 20 refineries and 52% of the 38,000-plus petrol pumps in the country.

IOC chairman B.M. Bansal said: “They have evinced interest to become a strategic partner. Our FPO is coming and they can take stake by buying our shares.”

The visiting Kuwaiti minister, who called on vice-president Hamid Ansari, and will meet Prime Minister Manmohan Singh on Tuesday, discussed KPC’s participation in IOC’s upcoming Rs.29,777 crore refinery and petrochemical complex at Paradip, in Orissa.

Al-Sabah, however, did not look very keen on the proposal, as KPC had “requests (for participation) lot of refinery projects... It (KPC’s participation) will depend on economics (of the project)”.