French energy giant Total SA is buying a 37.4 per cent stake in Adani Gas for an estimated Rs 5,700 crore. The move comes a year after Total entered into an alliance with Gautam Adani for a foray into the lucrative Indian fuel market.
Total, which in August 2018 exited a joint venture with Royal Dutch Shell in a 5-million-tonne liquefied natural gas (LNG) import terminal at Hazira in Gujarat, had in October 2018 formed a 50:50 JV for two LNG import terminals of Adani on the east and west coast of India as well as for the setting up of 1,500 petrol pumps in the country over 10 years.
The net acquisition cost of the deal stands at $600 million for Total over 2019-20 and the two partners will invest $1 billion in creating gas infrastructure. Adani Group in a separate statement said city gas distribution was a natural extension of the plans of both partners.
Total will acquire 37.4 per cent of Adani’s 74.8 per cent stake in Adani Gas — a firm that retails gas to automobiles and households.
As part of this partnership, Total will bring its LNG and retail expertise and will supply LNG to Adani Gas Limited. Total and Adani will also establish a joint venture to market LNG in India and Bangladesh.
Total will first make an open offer to buy a 25.2 per cent stake in Adani Gas. Depending upon the success of the offer, it will buy a stake from Adani to take its holding to 37.4 per cent in the company.
The Adani family holds a 74.8 per cent stake in Adani Gas and will dilute shares to the public to bring down its holding to 37.4 per cent — on a par with Total, the two firms said in separate statements.
Shares of Adani Gas on Monday rose 9.41 per cent to close at Rs 150.60 against Friday’s close of Rs 137.65 on the BSE.
ExxonMobil
US-based ExxonMobil on Monday said it has signed an MoU with Indian Oil to expand its LNG initiatives in the country.
“This initiative focuses on exploring new models of delivering cost-effective natural gas in India where it is most needed to complement traditional pipelines,” the company said in a statement.
