GOVT TELLS IOC NOT TO BID IN IPCL DIVESTMENT

Vol 3, PW 16 (01 Sep 99) News in Brief
     

Indian Oil Corporation (IOC) plans to protest a government decision to disqualify it from bidding in a 25% divestment of Indian Petrochemicals Corporation (IPCL).

On Monday (30th August) an Inter-Ministerial Group of Secretaries led by Prabhat Kumar, Cabinet Secretary, formally rejected IOCs Expression of Interest on the grounds that its is a state-run company. A final decision on the timing and price of the divestment will be made later in the year by a Core Committee of Secretaries and the Cabinet Committee on Economic Affairs.

One option discussed is to replace traditional sealed bids in favour of an open auction relayed live on television. The Indian government currently holds 60% of IPCL; domestic financial institutions 19%; the public 12.9%; GDRs 7.1%; and Foreign Institutional Investors (1%).