GNF may buy BG stake in Gujarat Gas
Spanish utility Gas Natural Fenosa is in talks with BG Group Plc to buy the UK oil and gas company’s 65% stake in Gujarat Gas, a source with direct knowledge of the matter said on Sunday, in a deal valued at about $900 million.business Updated: Apr 09, 2012 23:32 IST
Spanish utility Gas Natural Fenosa is in talks with BG Group Plc to buy the UK oil and gas company’s 65% stake in Gujarat Gas, a source with direct knowledge of the matter said on Sunday, in a deal valued at about $900 million.
A three-member consortium of Oil and Natural Gas Corp, Bharat Petroleum Corp Ltd and Gujarat State Petroleum Corp (GSPC) is the only other bidder in talks to buy BG’s stake.
The Indian unit of BG, which announced its intention to sell its stake in Gujarat Gas last November, hopes to finalise the deal with either of the two bidders by early May, the source said.Germany’s biggest utility, E.ON AG, UK-based Actis, and Adani group and Torrent group had been among the initial bidders for the BG stake, but dropped out given stiff valuations.
While the Spanish utility is likely to have bid close to the market price, the Indian consortium has valued the stake at a discount, the source said.
BG’s 65% stake in Gujarat Gas is valued at about $700 million at the current market price. The company acquiring the BG holding will have to make a mandatory open
offer for an additional stake, valuing the total deal at about $900 million.
Officials at BG and Gas Natural were not immediately available for comment.
Gujarat Gas, set up in 1980, supplies piped gas to 317,000 domestic and industrial customers and compressed natural gas to 144,000 users, mostly across Surat,
Bharuch and Valsad in Gujarat. The company also operates a 3,700-km (2,300-mile) gas pipeline network.
First Published: Apr 09, 2012 22:58 IST