NEW DELHI: In a strategic development that signals the consolidation of the energy security process for India, ONGC Videsh Limited (OVL), the overseas investment arm of the State-run Oil and Natural Gas Corporation, on Tuesday said it had received all regulatory approvals from the Russian government for the acquisition of UK-based Imperial Energy.
“There were two approvals that were required from the Russian government and they have come through. It is a big development for us. Now the company will take appropriate steps to seal the issue,” Petroleum Secretary R.S. Pandey told The Hindu here on Tuesday.
In a filing to the London Stock Exchange, OVL has stated that regulatory approvals have been granted in respect of the ownership of Russian entities by entities controlled by a foreign government. Russia’s Federal Anti-Monopoly Service (FAS) last week approved the $2.59 billion deal under anti-trust laws. Interestingly, OVL, despite being a wholly-owned subsidiary of a listed public sector company, chose to make the announcement on the acquisition only on the London Stock Exchange.
OVL said its acquisition of Imperial Energy, which has oilfields in Russia, was subject to the approval of the Government Commission of the Russian Federation in respect of the restrictions on the ownership of Russian entities by entities controlled by a foreign government and that of FAS in respect of anti-monopoly regulations. The Commission is headed by Mr. Putin and approval from it was expected on similar lines. Mr. Putin had directed his Energy Minister Sergy Shemato to visit New Delhi on November 25 to hold further talks on issues pertaining to oil and gas cooperation between the two nations.
OVL will now make an open offer to shareholders of Imperial Energy in 28 days. The shareholders in turn will get 28 days to give their consent on the issue. If 90 per cent of the shareholders give a positive response, then the deal will be completed.