The finance ministry has granted Cairn UK Holdings Ltd the Foreign Investment Promotion Board clearance for setting up a holding company.
BG Energy gets nod for two arms, too
NEW DELHI: The finance ministry has granted Cairn UK Holdings Ltd the Foreign Investment Promotion Board clearance for setting up a holding company, called Cairn India Ltd, for transfer of equity by way of swap. The clearance has been granted under the automatic route since oil exploration is open for foreign direct investment. The Indian entity would be going in for an initial public offering later this year.
It would be operating in all the segments of petroleum business including refining and marketing.
Another petroleum company to get clearance included BG Energy Holdings Ltd, which would be setting up two wholly owned subsidiaries for development and transmission of natural gas in Andhra Pradesh, Karnataka and Tamil Nadu.
This would mark BG’s foray into city gas distribution in the southern states. It is already into city gas distribution in Mumbai as Mahanagar Gas Ltd (MGL) and in Gujarat as Gujarat Gas Company Ltd (GGCL).
The British multinational wants to make an equity investment of $30 million in the new venture for Andhra Pradesh either directly or through its subsidiaries, affiliates or nominees including Singapore-based BG Asia Pacific Holdings Pte. Ltd.
BG is 49.75% equity partner in MGL which is a joint venture with GAIL and the Maharashtra government.
It has another joint venture, GGCL with 65.12% holding.
The government had earlier reservations on its FIPB application on the grounds that it will be under no obligation to provide natural gas for the venture. The Centre had also asked for comments of its partners in the two joint ventures engaged in similar work in Mumbai and Gujarat.
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