The Hindu Business Line : Gujarat Gas may not take stake in Adani group arm

GUJARAT Gas Company Ltd, a fully owned subsidiary of British Gas, may not pick up strategic stake in the Adani group's gas distribution entity following a "cooling off" of negotiations between the two sides.

Sources close to the negotiations said that the Adanis have demanded nearly Rs 450 crore for the proposed 50 per cent stake in Gujarat Adani Energy Ltd (GAEL). All that Gujarat Gas had on offer was about Rs 150 crore.

"The two sides had been in negotiations for quite some time. A due diligence process was also carried out earlier this year. But of late, there has been a reduction in interest," a source in the Adani group told Business Line. When contacted, a Gujarat Gas spokesperson said, "We do not comment on market speculation."

Mr Sanjay Gupta, Adani group CEO (Infrastructure), said that GAEL was fully capable of executing its expansion plans on its own.

"We are going ahead with our expansion plans. New CNG stations continue to be added and we are supplying gas to several industries in Ahmedabad and Vadodara."

On discussions with Gujarat Gas, Mr Gupta refused to comment.

Both companies were looking for strategic alliance to take on competition from State-owned companies such as GAIL (India) Ltd and IOC for gas distribution in Gujarat.

Gujarat Gas caters to household and industrial customers in south Gujarat cities such as Surat and Vapi, while the Adanis have the State Government licence for setting up distribution networks in Ahmedabad, Gandhinagar, and Vadodara.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page