Cash rich Oil and Natural Gas Corp (ONGC) will raise its first debt ever, of Rs 25,000 crore, to part fund the Rs 37,000 crore acquisition of government’s stake in Hindustan Petroleum Corp Ltd (HPCL).
India’s largest oil and gas producer has about Rs 13,000 crore in cash and would need to borrow the rest to fund the buying of government’s 51.11 per cent stake in HPCL.
ONGC has sought shareholder approval for “borrowing/ raising funds in Indian rupee and/ or foreign currency by issue of debt instruments (including bonds, non-convertible debentures and notes) in domestic and/ or overseas market” of Rs 25,000 crore.
The borrowings would be for “acquisition of projects/ equity shares and/or going concerns, meeting capital expenditure, working capital requirements and general corporate purposes during the period commencing from the date of passing of Special Resolution till completion of twelve months thereof or the date of the next annual general meeting in the financial year 2018-19, whichever is earlier,” the company said in a shareholder resolution. Read More…