x Abu Dhabi, UAEWednesday 26 July 2017

Hinduja prepares Saudi listing

Major Indian family group improves access to region

Petromin is a joint venture between Dabbagh and Gulf Oil International.
Petromin is a joint venture between Dabbagh and Gulf Oil International.

The Indian family conglomerate Hinduja Group is planning a US$1 billion (Dh3.67bn) public listing of its joint oil venture in Saudi Arabia. Petromin is an equal joint venture between Dabbagh of Saudi Arabia and Gulf Oil International, which is part of the Hinduja Group. "Soon we will be finalising the timeline and the exact valuations," Sanjay Hinduja, the co-chairman of Gulf Oil International, said in Mumbai.

Mr Hinduja said the group was aiming for an initial public offering (IPO) this year, or the first quarter of next year at the latest. SABB, the Saudi Arabian banking affiliate of HSBC, has been awarded the contract to manage the IPO, he said, adding Gulf Oil planned to dilute a 30 per cent stake in the offering. Owned by the billionaire brothers Srichand and Gopichand Hinduja, the family company has diversified interests in sectors including oil, banks and transport.

It owns Ashok Leyland, India's second-biggest lorry maker, and the lender IndusInd Bank. Last month Hinduja bought KBL European Private Bankers, the private banking arm of the Belgian group KBC, for $1.7bn to help improve the bank's access to the Middle East and Asia. Petromin owns a third of the downstream oil products business in Saudi Arabia and has $500 million in annual revenue, Mr Hinduja said. The company was considering acquisitions in the Gulf region to boost its business.

Gulf Oil and Dabbagh acquired the lubricant maker Petromin, which was then a joint venture between Saudi Aramco and the ExxonMobil affiliate Mobil Investments, in November 2007 for an undisclosed sum with the intention of expanding in the Middle East. Mr Hinduja said the group was planning an IPO in Hong Kong for Gulf Oil Marine, which provides marine lubricants and technical services for shipping.

Gulf Oil operates in more than 100 countries and its business encompasses lubricants, retail fuel station networks, filters, car care products and merchandising. Hinduja was also considering proposals to invest as much as $12bn to build 10,000 megawatts of thermal power in India over five years, said the co-chairman Gopichand Hinduja, including a 1,040mw plant already built in the state of Andhra Pradesh.

The group was looking at power plant sites in the states of Uttar Pradesh, Gujarat and Maharashtra, and would announce two power plants soon, he added. Faced with a shortage of electricity, India plans to spend $1 trillion on infrastructure including roads, ports and power plants in the five years to 2017 under government plans to help speed up economic expansion and reduce poverty. Hinduja's acquisition of KBL, considered one of Europe's largest onshore private banking units, will strengthen the company's presence in the European market.

KBC said the deal included KBL's custody and life insurance businesses and the entire operation would continue to be based in Luxembourg. * with agencies tarnold@thenational.ae