The government on Friday said interested parties that evince interest in bidding for BPCL would be required to take necessary security clearance which would be communicated to them at the Request For Proposal (RFP) stage. "Necessary security clearance shall be taken as per the details and requirements communicated to the QIP (Qualified Interested Parties) at the time of RFP," the Department of Investment and Public Asset Management (DIPAM) said while amending the Preliminary Information Memorandum (PIM) issued on March 7 for BPCL strategic stake sale.
According to the initial PIM provision, necessary security clearance, if required, shall be taken as per extant instructions of the Government of India. Each QIP will need to apply for security clearance at the time of submission of financial bids. While the Cabinet had in November last year approved the sale of government's entire 52.98 per cent stake in BPCL, offers seeking expression of interest (EoI), or bids showing interest in buying its stake, were invited only on March 7.
The EoI submission deadline was May 2, it was extended up to June 13 and then to July 31. It was then extended further till September 30. The government of India is proposing strategic disinvestment of its entire shareholding in India's second-biggest oil refiner Bharat Petroleum Corp Ltd (BPCL) comprising 114.91 crore equity shares which constitute 52.98 per cent of BPCL's equity share capital.
The proposal also include transfer of management control to a strategic buyer, except BPCL's equity shareholding of 61.65 per cent in Numaligarh Refinery Ltd — which will be sold to a state-owned oil and gas firm. The bidding will be a two-stage affair, with qualified bidders in the first EoI phase being asked to make a financial bid in the second round.
Public sector undertakings (PSUs) "are not eligible to participate" in the privatisation, the offer document said. Any private company having a net worth of USD 10 billion is eligible for bidding and consortium of not more than four firms will be allowed to bid.
'Net Worth' has been defined as the aggregate value of the paid-up share capital and all reserves created out of the profits and securities premium account, after deducting the aggregate value of the accumulated losses, deferred expenditure and miscellaneous expenditure not written off. "In case of consolidated financials, non-controlling interest (NCI) shall be included in the aforesaid definition of "Net Worth" for determining consolidated net worth based on the consolidated financial statements," DIPAM said in its amendments to the PIM.
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