December 6, 2011 [The Times of India] - Vopak is in the fray to acquire East India Petroleum, one of the largest storage service providers for oil and gas on the east coast, after its main shareholder Global Infrastructure Partners (GIP) appointed Kotak Mahindra Capital for a sale.
Vopak may vie with other international and domestic bidders like Indian Oiltanking for the deal with asking price in excess of Rs 500 crore. GIP, which owns several infrastructure projects including London City Airport, had acquired a 74% stake in East India Petroleum four years ago. A local firm holds the remaining stake. The PSU oil companies and private behemoths like Reliance Industries use the terminal facilities of East India Petroleum located at Visakhapatnam port.
A source at Indian Oiltanking-a joint venture between Indian Oil and Germany’s Oiltanking-confirmed that the firm has shown interest in East India Petroleum, which is the first private sector firm to set up a facility to handle liquid products and LPG or liquefied petroleum gas. A GIP spokesperson declined to comment on market speculation.
Banking sources said the bidding interest in East India Petroleum was mostly from foreign offshore shipping and terminal companies that are chasing the India opportunities . The attraction is its location , just off the Vishakapatnam port, which is the largest on the east coast and the second busiest in India by volume after Kandla in Gujarat.
East India Petroleum, which commenced operations in 1997, handles 1.2 lakh kilo litres of oil, petroleum and lubricant products and petrochemicals and 9,000 metric tons of LPG. Siddhartha Khemka, analyst at Centrum Broking said, “Rather than going for a greenfield project, it makes sense for international storage handling companies to acquire an existing facility. They could then scale it up and capture volumes.”
