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The giant industrial organization in India, the Reliance Industries has stated that it is discussing with the IDFC Private Equity for acquiring a 48 per cent stake in IDFCs city gas company, named the Krishna Godavari Gas Network (KGGNL). One of the senior government officials of Andhra Pradesh has informed the new and said that the KGGNL is actually a Joint Venture (JV) company between the Andhra Pradesh government, Gujarat State Petroleum Corporation and the IDFC Private Equity.
The official said, "RIL is keen on holding a controlling stake in KGGNL. GSPC is also keen on this. But, IDFC PE is in favour of RIL for the deal". He added that KGGNL was planning to source gas from the KG Basin block of GSPC and the IDFC is currently holding a 48 per cent in the company. The official also said that the Gujarat State Petroleum and the Andhra Pradesh governments investment arm, Andhra Pradesh Industrial Development Corporation is holding a 26 per cent stake each in the company.
One of the top officials from RIL has also confirmed the news and said, "Yes, we are talking to IDFC Private Equity. We are looking for a bigger stake in KGGNL". The industry sources informed that the KGGNL was formed for building natural gas transportation network in the state of Andhra Pradesh to supply the gas, that is going to be produced from the offshore Krishna-Godavari Basin, to the industrial and domestic consumers within the state. The official from RIL also said that the company has also made a number of gas discoveries in the KG Basin. He further informed that acquiring a majority stake in KGGNL is likely to make a strategic business proposition for the company, as it is planning to sell gas in the state of Andhra Pradesh and also to enter the city gas distribution segment.
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| Posted : 4/7/2008 |
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