No decision on GAIL's buying ADB stake in Petronet: Oil Min
The government has not taken a call on allowing state-owned gas utility GAIL India Ltd to buy Asian Development Bank's 5.2 percent stake in Petronet LNG.
New Delhi: The government has not taken a call on allowing state-owned gas utility GAIL India Ltd to buy Asian Development Bank's 5.2 percent stake in Petronet LNG.
"No decision has been taken yet," Oil Secretary Vivek Rae told reporters here.
ADB in 2011 offered to sell its 39 million shares or 5.2 percent stake in Petronet. GAIL, Oil and Natural Gas Corp, Indian Oil and Bharat Petroleum, which hold a 12.5 percent stake each in Petronet, along with GdF of France have the first right of refusal over the ADB stake.
Originally, all the four state-owned promoters - IOC, ONGC, GAIL and BPCL were interested in buying ADB' stake but the firm's management was opposed to the move as it would have led to PSU holding crossing 50 percent that would turn the LNG importer into a government entity.
Petronet is registered as a private company even though public sector oil firms hold 50 percent stake and Oil Secretary is its Chairman.
Following Oil Ministry's veto, IOC, ONGC and BPCL withdrew and waived off their pre-emption or right of first refusal. But GAIL continues to insist on buying ADB stake as its Board believes that it is strategically important for the gas player to have a greater say in Petronet.
Oil Minister M Veerappa Moily said: "There is no conflict and the issue will be resolved."
ADB has held 5.2 percent stake in Petronet since 2004. It had in fact first proposed to exit Petronet in 2008 but was persuaded to stay on as the four promoters made a strong pitch to buy the stake.
ADB norms also stipulate it to divest its equity holding in a company three years from the date of the entity going public. Petronet's IPO came in 2004 and ADB was supposed to exit Petronet in 2007, but was persuaded to stay on.