ONGC arm lead race for Imperial Energy: report

22 August 2008

Mumbai: ONGC Videsh Ltd (OVL), the overseas investment arm of state-run explorer ONGC, is reported to have taken a lead over rival China's Sinopec with an over $3-billion bid for acquiring Imperial Energy of the UK.

OVL, reports said, may take a Russian partner to counter Sinopec in the battle for acquisition of the Russia-focused oil exploration and production company. Imperial Energy has assets in Russia and Kazakhstan.

State-run OVL, which has received government backing for the investment, may go ahead and launch a full bid for the £1.2 billion explorer, shrugging off challenges from China's Sinopec and KNOC of Korea, reports.

OVL, which submitted an initial bid of £12.90 per share, or about $2.96 billion, is likely to raise it to £15 a share if Sinopec makes a counter offer, reports said, adding, the oil explorer could raise the bid to about $3.5 billion if competition hotted up.

Sinopec has been allowed to do due diligence at Imperial Energy and access its data room, making it the first Chinese challenge to an Indian company in a competitive auction of a London-listed company.

Korean National Oil Company (KNOC) also in the race and has access to the data room.