The finance ministry is in a 'wait and watch' mode on BPCL privatisation with the consortia that had submitted expressions of interest (EoIs) having cold feet.
Officials explain the reasons could be manifold, changing dynamics of the fossil fuel market, the deep pockets needed to buy a blue chip like BPCL and changes in the composition of various consortia that had initially shown interest.
According to government officials, out of the five to six expressions of interest that the government received, only one bidder remains to be in the fray.
Vedanta has issued a statement saying “the bid for BPCL is at EOI stage. In case the transaction culminates, Company may undertake management of the acquired business, through appropriate profit-sharing arrangement or on management fee model. A specific fund, with a strategic investor will be set up to fund the potential investment, without leveraging Vedanta Limited’s Balance Sheet."
However, this has not convinced the government to reconsider the BPCL privatisation process at this stage, by calling for fresh EoIs, although the option is always there.
According to the officials, the government is holding on to the current process and the transaction advisor will attempt to persuade the potential buyers to return to the table.
Until then, BPCL privatisation continues to be at the due diligence stage, with potential buyers yet to undertake physical visits of the fuel refiner and access the virtual data room.