New Delhi, Oct 07: Stung by the proposal to disinvest its marketing arm, Indian Oil Corporation is believed to have offered to acquire government stake in Hindustan Petroleum, a move that could easily meet the disinvestment target for the current financial year. Concerned over the implication of the decision taken by the cabinet committee on disinvestment to explore divestment of IOC's retail business, the top brass of India's sole fortune 500 company is understood to have asked petroleum ministry for consideration of its offer to buy out HPCL, saying it was willing to shell out Rs 10,000 crore for acquisition of government equity.

IOC, which was barred from participating in HPCL sale after it acquired petro retailer IBP Co Ltd, feels the move would be in "national interest" and was unlikely to create any monopoly as Bharat Petroleum Corp Ltd (BPCL) would be out of government control after public offering of 34 per cent stake and private players like reliance industries, Essar Oil and royal dutch/shell set shop, highly placed sources said. The company was interested in acquisition of HPCL and BPCL but had to stay out because of the government ban.

Previously, IOC had acquired government's minority stake in Oil and Natural Gas Corp (ONGC) and Gail (India) Ltd as part of a cross-holding formula devised to meet disinvestment target.

Sources said that ministries of disinvestment and petroleum will in next three months explore the possibility of selling government equity in IOC. The options include splitting the country's largest firm into separate retailing and refining business units and selling the former either to HPCL and BPCL or to a third party.
Bureau Report