AG&P in IRM Energy takeover discussions
After acquiring Think Gas, Manila-based AG&P subsidiary AGP City Gas wants to take over other small city gas retailers.
One of them might be Ahmedabad-based IRM Energy. "No one will confirm it right now," says a source with knowledge of the process.
"But the talks have been ongoing; AG&P wants to expand its presence in India's city gas retail sector." He adds that almost all areas in India have been auctioned in the 12 licensing rounds, and the only way to grow as a company is to target smaller companies like IRM."
Our source confirms that the talks between the two gas retailers are advanced. Another well-placed source predicts more mergers and acquisitions in the coming months because of rising gas demand in India and CGD sector consolidation.
"Look how GSPC and Gujarat State Petronet merged with Gujarat Gas," he says. "The days of big gas retailers are here; small players will be gobbled up."
AG&P is particularly interested in IRM because of its single Namakkal and Tiruchirappalli licensed area in Tamil Nadu. "AG&P has a relentless focus on southern India and wants to push out all other gas retailers," he adds.
Over the past six months, Cadila Pharmaceuticals-promoted and owned IRM has been in the news for the wrong reasons. In January 2024, a former female IRM employee from Bulgaria filed a police complaint against Cadila Pharma chairman Rajiv Modi alleging rape on his private jet.
Days later, independent director Geeta Goradia resigned in protest. On February 3 (2024), Swetang Goti, head of the Diu and Gir Somnath areas in southwest Gujarat, resigned, effective May 3 (2024).
On June 4 (2024), company secretary and compliance officer Shikha Jain quit, effective June 21 (2024). On June 26 (2024), chairman and non-executive director Maheshwar Sahu chose not to be re-appointed to the board, where he was a co-founder.
And on July 9 (2024), chief executive Karan Kaushal quit, effective from July 31 (2024). Not all of AG&P's efforts to acquire smaller players have been successful.
Earlier talks with Hyderabad-based Megha Engineering were unsuccessful.