Oct. 3: British energy major BG Group today said it had reached an agreement to sell its majority stake in Gujarat Gas Co Ltd to Gujarat State Petroleum Corp (GSPC) for over Rs 2,460 crore.
BG Group said it would sell its 65.12 per cent stake in Gujarat Gas to GSPC Distribution Networks Ltd (GDNL), a 100 per cent subsidiary of GSPC.
The deal, subject to regulatory approvals, is scheduled to be completed during the first half of 2013, BG Group said in a statement.
GDNL is buying Gujarat Gas shares at Rs 295 apiece. This is at a discount to the stock’s closing price of Rs 337.20 on the National Stock Exchange today.
The company’s shares had touched a 52-week low of Rs 288 in June, while it had scaled a high of Rs 458.85 in November last year.
BG Group chief executive Frank Chapman said: “With this announcement, we have non-core asset sales agreements in place that will release some $4 billion from our balance sheet. We have made outstanding progress since announcing our two-year $5-billion release programme only eight months ago and we remain focussed on the successful delivery of our growth projects.”
Tapan Ray, managing director of GSPC Group, said, “We are pleased to announce this acquisition that enhances GSPC Group’s presence in the state. The acquisition is in the long-term interest of industrial and retail customers of Gujarat.”
Gujarat Gas is the country’s largest private natural gas distribution company. Set up in 1980, it supplies gas to more than 3.49 lakh domestic, commercial and industrial customers and serves over 1,75 lakh compressed natural gas users. It has a network of around 49 CNG stations in Bharuch, Ankleshwar, Surat and the surrounding areas of Gujarat.
The Gujarat government along with its PSUs have a majority stake in GSPC Group.
The deal is consistent with GSPC’s objective of expanding its presence in the upstream and downstream segments of the energy value chain and developing Gujarat as a natural gas driven economy, the company said in a statement.