M&A: Sun Pharma plans $1.2m spend at Interlink

Vol 18, PW 16 (09 Apr 15) People & Policy
     

Sun Oil & Natural Gas, sister company of billionaire Dilip Shanghvi’s Sun Pharma, is planning to pump in between $500,000 and $1.2m to begin production at the Baola and Modhera fields in Gujarat, operated by Interlink Petroleum.

Interlink announced to the BSE on March 30 it had signed a binding MoU with Sun for the “transfer and assignment” of its 4-sq km Baola and 12.7-sq km Modhera PSCs, based on Sun’s “financial and technical strengths" - a move that allows industry newcomer Sun to work at the fields for a year to lift production and monetise reserves. Mumbai-based Sun will then decide if it wants a stake in Interlink.

“It’s a good opportunity,” Interlink tells us. “We’re expecting DGH approval for the Sun work programme in two months.

” Company chairman Vijay Misra took a Sun team led by CEO Padam Singh to visit Modhera and Baola on April 8. Two weeks earlier on March 27 the two companies held a meeting at the DGH to signal their intention to sign the MoU which could see Sun take up to 100% in Interlink depending on the pilot project results.

Interlink however clarifies that it must keep at least 10% itself under BSE rules. Chye Cheng Lee, managing director of Singapore-based Loyz Energy, holds 51.78% in Interlink where he is director-promoter.

“Lee has spent over $20m till date,” adds Interlink. “He doesn’t want to spend more.

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