The disinvestment of promoter Andrew Yule's stake in lubricant outfit Tide Water Oil might turn out to be a high-voltage affair. Sources close to the development said that major domestic and international oil players — Reliance Industries, French oil giant Total, US oil giant Chevron, Hinduja group and Keventer group — have evinced interest in bidding for the Calcutta-based firm.
Tide Water markets lubricants under Veedol brand and is a key player in the diesel lube market in the country. The Union ministry of heavy industries has already given green signal to the divestment of Tide Water Oil in May. The ministry has also asked Andrew Yule to appoint a consultant for the same.
When contacted, the CMD of Andrew Yule, Kallol Datta, said the company would float a global tender for appointing a consultant for disinvestment of Tide Water by end-June. “We are hoping to get a good response,” he said. However, he did not comment on the interest shown by the oil giants for acquiring Tide Water. But, according to sources, Reliance Industries has internally discussed about the synergy between its business and Tide Water. “They might consider to bid for the lube firm,” sources added.
Commenting on Total, sources added that the French oil major has already sounded few Indian firms for Tide Water bid. Total markets lube in India under 'elf' brand. It has a wholly owned subsidiary in India called Total Finaelf India. Andrew Yule is planning to divest its stake in Tide Water as a part of the restructuring process. The company was originally floated as a joint venture with Caltex (now Chevron) 60 years back. Chevron still holds 22 percent stake in Tide Water through a subsidiary called Four Star Oil.
According to sources, Chevron has appointed a US-based strategic consultant, Monitor, to formulate a strategy for Tide Water Oil. “It is looking at all options, including selling its stake,” sources said. Currently, Chevron only has lube operation in India through a subsidiary. It markets lubes under Delo and Hebolin brands here.
Incidentally, ONGC had shown interest to acquire Tide Water a few years back when it was headed by Subir Raha. Raha, now the vice-chairman of Hinduja group in India, once told TOI that if terms of reference suits them Hindujas would bid for Tide Water.
City-based Keventer group already has a substantial stake in the Rs 450-cr company. When contacted, Keventer chairman MK Jalan admitted that it has appointed Ernst & Young as a consultant for bidding in Tide Water.
Incidentally, Andrew Yule holds 26 percent stake in Tide Water Oil. The insurance companies LIC and United India Insurance hold 14.3 percent stake in the company. Datta earlier said that as per the restructuring package, the insurance companies too would divest their holdings in Tide Water.
Source: Trading Markets