Investors, who had been minority shareholders of the formerly listed Essar Oil investor, should get anywhere between ₹94 and ₹125 on each share they tendered in the delisting offer last December, according to calculations made by proxy advisory Stakeholders Empowerment Services (SES).

Essar Oil delisted from stock exchanges, paying its minority shareholders ₹262.80 for each share.

On Saturday, the promoters of Essar Oil — brothers Shashi and Ravi Ruia — announced that they were selling 98 per cent of the company to a consortium of Russian investors, including the exploration company Rosneft and oil trading firm Trafigura.

The all-cash deal assigns an enterprise value (a total of equity and debt minus cash) of ₹72,800 crore for Essar Oil's Vadinar refinery in Gujarat and fuel retail assets. An additional ₹13,300 crore will be paid for the adjacent Vadinar port and related infrastructure. Essar Oil operates India's second largest refinery at Vadinar with a capacity of 20 million tonnes per annum, a 1,010-MW captive power plant and a network of 2,700 operating fuel retail outlets.

While the deal has been in the works for over 18 months, Essar Oil had to first delist the company from the stock exchanges before the sale. To complete the process, Essar Oil paid ₹3,745 crore to shareholders who tendered their shares.

At the time, Essar Oil also agreed with the market regulator SEBI that if the company’s sale goes through at a higher per share price than the exit price for delisting, the difference will later be paid to the minority shareholders.

While the promoters of Essar Oil did not indicate the equity valuation the company received from the sale, SES calculated it to be at least ₹50,737 crore, based on the company’s annual report of March 2015.

By this, the value per share is at least ₹357, making the company liable to pay another ₹1,341-₹1,787 crore to former minority shareholders, SES estimated. It also recommended that SEBI must seek full disclosure on the details of the deal, related documents and evaluate the price paid by Rosneft and others. While the Essar Group is projecting the sale of its oil refining and retailing business as the single largest FDI into the country, SES countered it, calling the claim a “misrepresentation of fact”. After the delisting, the promoter family effectively held 97.14 per cent of Essar Oil through two Mauritius-based holding companies. “Therefore, whatever amount is paid to promoters for equity will be paid abroad and nothing will move to India from this deal. Whether out of this amount, the promoters will bring anything to India is a separate issue and not connected to this deal.”

When contacted, Essar Group said, “Essar Seller entities will abide by the commitment made to Essar Oil minority shareholders at the time of delisting. We will pay the difference between delisting price and the final equity price at which shares are sold by Essar Seller entities to Rosneft and others. The final price will be determined by independent experts. We believe that this would put to rest any concern or doubt being raised by anyone in this regard and we have no difficulty in assuring the minority shareholders who have or will (till exit window is open) participate in the delisting process that thier interest will be taken care of."

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