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Wed 2 Jun 2010 01:38 PM

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Gulf Oil unit to raise $1bn with Saudi listing

Gulf Oil and Dabbagh Group will together dilute a 30 percent stake in the IPO.

Gulf Oil unit to raise $1bn with Saudi listing
GROWTH: Gulf Oil’s Saudi Arabian unit plans to raise as much as $1bn selling shares in the local market.

Gulf Oil’s Saudi Arabian unit plans to raise as much as $1bn selling shares in the local market at the end of the year, Chairman Sanjay Hinduja said at a press conference in Mumbai Wednesday.

India’s Hinduja Group, controlled by billionaire brothers Srichand and Gopichand Hinduja owns Ashok Leyland, India’s second-biggest truckmaker, lender IndusInd Bank and chemicals maker Gulf Oil. The group last month agreed to buy KBC Groep NV’s private bank for $1.69bn to expand its wealth-management business in Europe.

Saudi British Bank, 40 percent owned by HSBC Holdings, will advise Gulf Oil on the unit’s initial public offer, Sanjay Hinduja said. Gulf Oil and its partner in the Saudi unit Dabbagh Group will together dilute a 30 percent stake in the IPO, he said.

In November 2007, Gulf Oil and Dabbagh acquired lubricant maker Petromin, a joint venture between Saudi Aramco and an Exxon Mobil unit, for an undisclosed sum to expand in the Middle East.

Petromin plans to increase exports by 25 percent this year, the Asharq al-Awsat newspaper reported May 16, citing CEO Samir Nawar.

The company’s new $26.7m blending plant is expected to start production in the third quarter of this year, Nawar told the daily. The plant, being built at the Saudi Aramco Industrial Zone in Jeddah, will boost Petromin’s annual production capacity of lubrication oils by 250,000 tonnes.

Separately, Sanjay Hinduja said the group’s due diligence for a natural-gas project in Iran with Oil & Natural Gas, India’s biggest explorer, is over.

ONGC and the Hinduja Group last year agreed to buy a 40 percent stake in the 12th phase of Iran’s South Pars natural-gas field.

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