“The offer is in the vicinity of about $10 to $12 billion,” one source said, while another said it was around the upper end of the band. The two sources declined to be named as they are not authorised to speak to the media.
Both Reliance and LyondellBasell did not disclose the size of the offer in their statements.
Reliance Group, India’s largest conglomerate, has been looking to expand, taking advantage of low valuations to delve into international markets.
The company is aiming to attain global scale for its conventional energy platform — petrochemicals, refining and oil and gas exploration — and invest in its new businesses such as retailing and alternative energy, chairman Mukesh Ambani said this week at the company’s annual meeting of shareholders.
Vijay said there were some concerns when RIL promoters sold treasury stock and now the management was keeping its word when it had promised some global acquisitions.
“The RIL stock too has been doing well in the last two weeks compared to the battering it received since June. It is still not on our buy list yet because of the huge overhang of the Supreme Court case [relating to gas] but this is surely a positive development.”
‘How you read the deal is a function of the price RIL pays,” said Adrian Mowat of JPMorgan.
“We suspect they will be pretty cautious in the price that they are willing to pay.”
Mowat added that RIL’s refining margins, which were currently under pressure, would improve if the Lyondell acquisition went through.
Source:http://www.moneycontrol.com/news/business/lyondell-deal-willrils-refining-margins-experts_426528.html
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