Calcutta, April 5: The government is expected to invite price bids for the disinvestment of Tide Water Oil Company — the Andrew Yule subsidiary — within a month.
The disinvestment of the company was awaiting the nod of the Cabinet Committee on Disinvestment. The Core Group of Secretaries on Disinvestment gave its approval to the disinvestment of the company on Friday.
The Union government along with the Life Insurance Corporation of India and United India Insurance are divesting 42 per cent stake in the lubricant producing company.
“The management of the company has been led to understand that the government would invite price bids within a month,” said A. Raghuram, Tide Water’s chief executive.
Five leading petroleum companies are in the fray to grab Tide Water. IBP, Hindustan Petroleum Corporation Ltd (HPCL), Bharat Petroleum Corporation Ltd (BPCL), Shell and Chevron Texaco have submitted expressions of interest.
The Chevron Texaco group is reported to be the frontrunner in the race. Though the company, at present, has a 22.4 per cent stake in Tide Water it does not have any representation on the board of the company. Acquiring the 42.4 per cent stake that has been put on the block will give the Chevron Texaco group management control of the company.
The acquirer will have to make a public offer for 20 per cent of the company’s shares in keeping with the takeover regulations.
M. K. Jalan, a Calcutta-based investor and entrepreneur claims to have 14 per cent stake in Tide Water. But company executives said they could not identify his firms that hold the shares.
“Our records do not show a holding as large as Jalan claims. He has never indicated to us the firms through which he holds the shares in the company,” a Tide Water executive said.