Industry & Economy
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Petroleum
IIM Prof favours 2-company oil sector structure
Our Bureau
New Delhi
,
Sept. 30
AS part of the proposed restructuring exercise to make public sector oil companies globally competitive, IIM professor N. Venkiteswaran has suggested that two major corporates be formed through mergers and acquisitions.
Prof Venkiteswaran, who teaches at the Indian Institute of Management, Ahmedabad, was invited by the Petroleum Ministry to present his viewpoint.
He argued that the present crowd of ten listed public sector oil companies is far too many since in countries such as China there are only three companies.
He has suggested two major conglomerates. Of this, one would be made up of Oil and Natural Gas Corporation, Bharat Petroleum Corporation Ltd, Hindustan Petroleum Corporation Ltd.
The other would be made up of Indian Oil Corporation, Oil India Ltd and GAIL (India) Ltd.
He pointed out that such an industry structure would promote healthy competition and at the same time ensure that companies do not work at cross-purposes.
The two-company structure would create entities that would individually have a market capitalisation of around $50 billion, one-sixth of that of oil major Exxon Mobil.
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