The Hindu Business Line : Prize Petroleum eyes IPO route

Prize Petroleum Company Ltd, which was in the process of inducting a private equity firm as a partner, is now examining the prospects of coming out with an initial public offering (IPO). Mr M.N. Prasad, CEO of Prize Petroleum, said, "The process of induction of equity partner has got delayed and certain issues need to be sorted out. Meanwhile, as an alternative way of raising resources, the company is considering going for an IPO."

Prize Petroleum, which had appointed Grant Thornton as an independent advisor to induct a private equity company, was in talks with three private equity firms for raising $50 million. The companies which have envisaged interest in company include IDFC Private Equity, Sabre Capital and Barings Inc.

Currently, the company's paid-up equity capital stands at Rs 20 crore. With the induction of equity partner, HPCL's holding in the company would remain at 50 per cent the balance would be with financial institutions or the private equity firm. Prize Petroleum was looking at garnering about $50 million by offering 50 per cent stake.

Prize Petroleum currently has four fields in Gujarat. Of these, three are marginal fields and one is an exploration field under the product-sharing contract with the Government.

Last year, the company had acquired a cluster of three fields (Cluster 7) in Mumbai offshore. The company in consortium with HPCL, M3nergy (Malaysia) have entered into a service contract for development of three offshore marginal fields.

On the company's overseas venture, he said, the company is looking at acquiring assets abroad. Indications are that the company is examining the prospects of acquiring blocks in Egypt. These blocks belong to an US-based company. The company is currently doing the due diligence of the assets.