HPCL divestment: Cabinet to consider sale of Rs 26k-cr govt stake to ONGC

The Cabinet is likely to consider this month sale of government's 51 per cent stake in Hindustan Petroleum Corp Ltd (HPCL) to Oil and Natural Gas Corp (ONGC) for over Rs 26,000 crore.The Department of Investment and Public Asset Management (DIPAM) in the Ministry of Finance is moving a note for consideration of the Cabinet for divesting government's entire 51.11 per cent shareholding in India's third-biggest fuel retailer HPCL to oil producer ONGC. The Cabinet may take up the proposal this month, a source in the government said. "It may come before the Cabinet as early as 10 to 15 days," he said. After the Cabinet nod, the government will move to appoint valuation and transaction advisers while ONGC too may decide to hire merchant bankers to arrive at the valuation of government shareholding. Financial Astrology Tips

Following up on Finance Minister Arun Jaitley's Budget announcement of creating an integrated oil company, ONGC evaluated options of acquiring either HPCL or Bharat Petroleum Corp Ltd (BPCL) - the two downstream oil refining and fuel marketing companies. While acquiring either one of them made a lot of business sense, ONGC found the nation's second-biggest fuel retailer BPCL too expensive. It then conveyed its choice to the parent oil ministry, which relayed it to DIPAM. After few rounds of inter-ministerial consultations, DIPAM is now approaching the Cabinet for a nod for the transaction, the source said, adding the transaction is likely to be completed within this fiscal year. ONGC has a cash reserve of Rs 13,014 crore and to fund the government stake acquisition in HPCL, it will have to borrow at least Rs 10,000 crore, the source said. Astrology and Numerology Trading Tips