Sabarmati Gas - here today gone tomorrow!
Set up in June 2006, GSPC and Bharat Petroleum joint venture Sabarmati Gas will disappear in October 2015, swallowed by Gujarat Gas Ltd. PETROWATCH learns investment banker SBI Caps is working on a deal which would see GSPC (25%) acquire up to 20% of BPCL's 25% stake and assume full management control at Sabarmati which will merge into former BG-controlled Gujarat Gas.
GSPC, which owns Gujarat Gas, will also acquire the stakes of three institutional investors looking to exit Sabarmati: IFCI Venture Capital Fund (16.62%), IDFC Project Equity Company (16.62%) and the Unit Trust of India (16.62%). "SBI Caps is doing the valuation," says an industry source.
"Based on that further action will be taken." He explains GSPC is not happy with the way BPCL is managing Sabarmati. Acquiring Sabarmati, he adds, will allow GSPC to expand quickly.
Sabarmati is the only gas retail JV between a central government company (Bharat Petroleum) and a state government undertaking (GSPC) and supplies 950,000 cm/d to 82,500 homes, and 600 factories and businesses in north Gujarat's Gandhinagar, Mehsana and Sabarkantha districts. Sabarmati also operates 36 CNG stations and plans to set up 20 more by end-2016.
Gujarat Gas is India's largest gas retailer, created on May 16 after the formal merger of former BG gas retailer Gujarat Gas Company with GSPC Gas.