BPCL bids close today, eyes on RIL

NEW DELHI: Initial bids for privatisation of Bharat Petroleum (BPCL) will close on Monday amid indications that UK’s BP, Total of France and Saudi Aramco are unlikely to bid. The government, which is selling its entire — nearly 53% — stake in the company, had on four occasions extended the date of putting in the preliminary expression of interest.
The acquisition makes sense for companies which can double the profit by growing the business as well as through operational efficiencies and synergies with existing business in half that timeframe. RIL, which operates the world’s largest single location oil refining complex and has ambitions to retail fuel, can be one such company, but it has remained tightlipped about its intentions. Sources said BPCL annually makes a profit of about Rs 8,000 crore and at this pace it would take 8-9 years for the investor to recover the bid amount of over Rs 70,000 crore.