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State-owned Hindustan Petroleum Corp Ltd (HPCL) will buyout the shares of financial institutions ICICI Bank, ICICI Venture and HDFC in Prize Petroleum Co Ltd to make the oil exploration firm its wholly owned subsidiary.
HPCL and its partners had floated Prize Petroleum in 1998 to explore and produce oil and gas in India and abroad. HPCL owns 50 per cent stake in the company, while ICICI Bank holds 35 per cent interest. ICICI Venture has 10 per cent stake and HDFC the remaining 5 per cent.
“The board of HPCL on April 15 approved the acquisition of balance 50 per cent shares held by other joint venture partners in Prize Petroleum Company Ltd,” a top company official said.
HPCL will acquire 70 lakh shares held by ICICI Bank Ltd in Prize Petroleum at par value of Rs 10 each amounting to Rs 7 crore. Similarly, it will acquire 2 lakh shares held by ICICI Venture Capital for Rs 2 crore and 1 lakh shares held by HDFC for Rs 1 crore.
After the acquisition, Prize Petroleum will turn into a wholly owned subsidiary of HPCL.
It will also convert five crore Cumulative Convertible Preference Shares at a face value of Rs 10 each held in Prize Petroleum into five crore fully paid equity shares at par value of Rs 10 each.
HPCL was previously trying to buyout the financial institutions’ shares at discount but ICICI Bank and ICICI Venture wanted par value for their shares, the official said.
After the buyout, Prize Petroleum will takeover the oil and gas exploration and production business of HPCL.
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