NEW DELHI: The Centre’s attempts to divest its entire stake in state-run oil marketing company Bharat Petroleum Corporation Ltd (BPCL) this fiscal year seems to have run aground. On Wednesday, the Department of Investment and Public Asset Management (DIPAM) issued yet another deadline extension for submission of bids from interested investors-for the fourth time this year.
The authorities had received the final nod to begin privatisation as early as November last year, when the Union Cabinet gave its approval for the sale of the Centre’s 52.98 per cent stake in the OMC. It was another three months, March 7, before the government invited Expressions of Interest (EoI) setting a deadline for May 2. The chaos caused by the pandemic over the summer in the oil markets, however, made conditions “unfavourable”, according to government sources.
The result was that the EoI submission deadline was first extended up to June 13, then July 31, and eventually September 30. DIPAM’s Wednesday notice has now extended this yet another time-to November 16. “In view of further requests received from the interested bidders (IBs) and the prevailing situation arising out of Covid-19 pandemic, the last date for submission of EoIs is further extended...,” the DIPAM notice said.
The extension spells trouble for Central government incomes this fiscal year because the planned stake sale accounts for a substantial part of the Rs 2.1 lakh crore divestment target for this fiscal. BPCL has a market capitalisation of around Rs 76,600 crore currently.
EoI bid submission only start of process
Once the EoIs come in, the government will have to set up a data centre for the interested bidders to complete due diligence. It is only post this that financial bids will be called for from eligible bidders.