ONCG may buy HPCL in Rs 44,000 crore deal

Oil and Natural Gas Corporation (ONGC) may acquire the complete stake in Hindustan Petroleum Corporation Limited (HPCL) for a $6.6 billion (nearly Rs 44,000 crore) deal, sources told PTI. 

ONGC's plans to snap up HPCL comes at a time when the government is looking to create an integrated oil giant. The plans were first revealed in Budget 2017 by Finance Minister Arun Jaitley. If the deal goes through, ONGC may buy the government's complete 51.11% holding. 

There are only six major companies in the sector - ONGC and Oil India Ltd being the oil producers, Indian Oil Corp (IOC), HPCL and Bharat Petroleum Corp Ltd (BPCL) in refinery business and GAIL in midstream gas transportation business.

Apart from this, ONGC is also likely to come up with an open offer to acquire additional 26% stake in HPCL, PTI said.

According to PTI, sources said HPCL would add 23.8 million tonnes of oil refining capacity to ONGC, making the merged entity  the third largest refiner in the country after Indian Oil Corporation and Reliance Industries Limited. Its size would be comparable to big global oil companies like Shell BP and Exxon, The Economic Times said. 

Earlier there were reports that ONGC was looking to snap up complete stake in HPCL or BPCL.