BPCL shelves IPO for subsidiary

State-owned Bharat Petroleum Corp. Ltd. (BPCL) said it deferred plans for an initial public offering (IPO) for a subsidiary that is building a grassroots refinery at Bina in Madhya Pradesh, India. Bharat Oman Refineries Ltd. (BORL) had filed a draft red herring prospectus (DRHP) with the Securities Exchange Board of India (SEBI) on March 28, 2008 to raise equity for the refinery project. However, the company decided to suspend its IPO plans. Work on the project, the company said, is as per schedule and the refinery is expected to start operating in January 2010. BORL may consider filing a new DRHP in the future when market conditions improve. At present, BPCL and Oman Oil Company are the shareholders of BORL. BPCL’s refinery project is funded by a mix of debt and equity. BORL has already entered into an agreement with a consortium of lenders for the debt component of Rs64 billion (US$1.25 billion). (March 3, 2009)