GAIL keen to buy ADB stake in Petronet LNG for about Rs614 crore

GAIL, Oil and Natural Gas Corporation, Indian Oil and Bharat Petroleum hold a 12.5% stake each, to restrict the public sector holding in the company at 50%. Gaz de France (GdF) holds 10%. Under the Share Holders' Agreement (SHA), the five have the first right of refusal over ADB stake

New Delhi: The Asian Development Bank plans to sell its 5.2% stake in Petronet LNG, which the state-owned gas utility GAIL India is keen to acquire and may have to pay over Rs600 crore for it, reports PTI.

ADB has offered to sell its 39 million shares or 5.2% stake in Petronet, which is valued at over Rs614 crore at today's trading price of Rs157.85 per share on the BSE, sources privy to the development said.

GAIL, Oil and Natural Gas Corporation, Indian Oil and Bharat Petroleum hold a 12.5% stake each, to restrict the public sector holding in the company at 50%. Gaz de France (GdF) holds 10%. Under the Share Holders' Agreement (SHA), the five have the first right of refusal over ADB stake.

GAIL has proposed to the oil secretary GC Chaturvedi, who is the chairman of Petronet, that it can buy the entire 5.2% stake of ADB. In case other companies are also interested, ADB stake can be split equally among GAIL, IOC, ONGC and BPCL with each buying 1.3% stake.

ADB stake being bought by state firms would turn Petronet into a public sector company with shareholding of state firms rising above current 50%, sources said, adding that GAIL is agreeable to this as it will bring more accountability in running of Petronet.

When contacted, an ADB spokesperson from Manila said: "ADB has held a 5.2% stake in Petronet LNG since 2004.

ADB always looks to exit its equity investments once it believes that the development mission has been accomplished."

ADB had in fact first proposed to exit Petronet in 2008 but the then company CEO Prosad Dasgupta was in favour of a third party like Chevron or the steel baron Lakshmi Mittal's group buying the stake instead of the four promoters.

Sources said Mr Dasgupta had on 29th February in that year written to the then GAIL chairman UD Choubey to say that sale of "even one share" held by ADB to the four promoters or GdF would trigger the takeover code, turn the joint venture into a state-run firm and may result in delisting from the bourses.

ADB and German Development Bank KfW had in 2008 approved a loan of $169 million to Petronet for its expansion projects at Dahej and new terminal at Kochi, but the multilateral lending agency's internal norms prohibit it from having both debt and equity exposure in a company.

"In 2004, ADB had sanctioned $75 million loan to Petronet. But once it took 5.2% stake for less than $8 million, ADB could not disburse the balance due to its internal regulations," a source said.

ADB norms also stipulate it to divest its equity holding in a company three years from the date of the company going public. Petronet's IPO came in 2004 and ADB was supposed to exit Petronet in 2007, but was persuaded to stay on.

Last year, ADB had for the second time offered to quit Petronet and the current move is its third attempt, sources said.

"Since the four promoters and GdF could be seen as entities acting in concert by virtue of the SHA, the purchase of ADB's 5.2% by any one of them will immediately trigger the takeover code-meaning collectively an open offer has to be made for at least 20% shares held by the public," Mr Dasgupta had written in February 2008.

"This would result in the collective holding of the promoters and GdF increasing to 85%. Since a company cannot remain listed if the public holding goes below 25 per cent, the takeover code would require the promoters and GdF to again collectively make an offer for the remaining 15%, leading to delisting of the company," he wrote.


Toyota Kirloskar Motor registers 105% growth in sales

Toyota Kirloskar Motor registered sales of 12, 807 units in September 2011 compared to 6,235 units in September 2010

Toyota Kirloskar Motor's sales grew by 105% when compared to the corresponding period last year. The company registered sales of 12,807 units in September 2011 as compared to 6,235 units in September 2010.

Sandeep Singh, deputy managing director, marketing, TKM said, "We have registered a growth of 105% in September sales. This growth can be attributed to the sales of Etios and Etios Liva clocking a total of 5926 units. The flagship brand Innova, along with Fortuner and Corolla, has also contributed to this growth. This is a positive sign for us at the onset of the festive season."   

The Etios and Etios Liva recorded a sale of 2,951 and 2,975 respectively along with the Innova clocking 4,765 units. The Corolla Altis and Fortuner also recorded a sale of 994 units and 1,078 units respectively.


Maruti Suzuki sales down nearly 21% in September

Maruti sales decline due to labour unrest at its Manesar plant

The country's largest car maker Maruti Suzuki India (MSI) today reported a 20.8% decline in sales for September to 85,565 units due to labour unrest at its Manesar plant that severely affected production.

The company had sold 1,08,006 units in the same month last year, MSI said in a statement. "The disruption in production owing to the labour issue at the company's Manesar plant during September adversely impacted the sales numbers during the month," it said.

The Manesar facility rolls out MSI's high volume compact car Swift that has a waiting period of over four months. The plant also produces hatchback A-Star and sedan SX4.

The National Capital-based company recorded sales of 78,816 units, including utility vehicles, in the domestic market last month-17.2% fall from 95,148 units in September 2010.

MSI's exports in September also fell, down 47.5%, to 6,749 units from 12,858 units in the year-ago period, the company added.

The company's total passenger car sales in the domestic market dipped 17.8% to 66,667 units in September from 81,060 units in the same month of 2010, it added.

Sales of the company's mini-segment cars, including the M800, A-Star, Alto and WagonR, fell by 23.5% to 37,324 units from 48,780 units in September 2010, it said.

The compact segment (comprising Estilo, Swift and Ritz) witnessed a 9.3% dip in sales to 19,722 units from 21,749 units in the same month a year ago.
Sales of DZiRE, however, grew by 9.9% to 9,411 units from 8,566 units in the corresponding period a year ago, the company said.

MSI's mid-sized sedan SX4's sales slipped by 90% to 196 units from 1,965 units in the year-ago month. Luxury sedan Kizashi witnessed sales of 14 units.

In the late afternoon, Maruti Suzuki India was trading at around Rs1078.85 per share on the Bombay Stock Exchange, 0.24% down from the previous close.


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