IOC likely to bid for petrol pumps in Thailand

By siliconindia   |   Tuesday, 04 May 2004, 19:30 IST
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NEW DELHI: State-run Indian Oil Corp may bid for acquiring petrol pumps owned by Kuwait Petroleum Corp and Jet, a subsidiary of Canoco Philips, in Thailand to expand its retailing operations beyond India. IOC, India's largest oil refining and marketing company, has chalked out a plan to become a $50 billion company in next five years through acquisitions of both downstream oil refining and marketing and upstream exploration and production businesses abroad. "We have received offers for acquiring retail outlets owned by Kuwait Petroleum Thailand and Jet. IOC board has approved a due diligence of the offer, based on which a decision on bidding for the assets will be taken," a senior company official said. Both the firms have about 90 petrol pumps and together account for 12 per cent of the retail business in Thailand. Though the margin on fuel sales is low because of stiff retail competition, non-auto fuel sales are good. Kuwait Petro has a little over five per cent market share with a network that includes Everyday convenience stores while Jet has six per cent market share, they said. IOC has already set foot in Sri Lanka and Mauritius by acquiring petrol pumps and is eyeing more such acquisitions. Sources said the company, which lost its bid to enter the petroleum retail market in Malaysia, has decided against bidding for British Petroleum's retail business in Singapore. The decision against bidding for BP's Singapore pumps followed the British firm withdrawing its Singapore refinery from the offer. This left only 30 petrol stations with 12 per cent market share and LPG business up for grabs. "Malaysia offered good volume growth prospects but Singapore, in isolation, was not profitable," a source said. Petronas of Malaysia had bagged BP's 70 per cent equity in BP Malaysia Bhd by opting for pre-emption rights under its First Right of Refusal. BP Malaysia owned 272 retail outlets and a 50,000-kilolitre terminal and accounted for 10 per cent of Malaysia's fuel market and 13 per cent of LPG sales. "Nothwithstanding the setback in Malaysia and Singapore, we will continue to look for opportunities," the source added.

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