Total to Buy 37.4% Stake in Adani Gas

French energy giant Total will buy 37.4% stake in Adani Gas, marking another big-ticket entry of a global major in India’s energy market after Shell and BP which are already in India, and Reliance Industries Ltd’s talks for a possible sale of 20% of its core oil-to-chemicals division to Saudi Aramco.

Total will acquire the stake with an open offer to buy up to 25.2% at ₹149.63 a share, but the share closed at ₹150.60 on Monday, after rising 9.4%. The French oil & gas firm will top up its stake in Adani Gas to 37.4% by buying the required number of shares from the promotors after the outcome of the open offer is known. It has a market value of ₹16,563 crore based on Monday’s closing price.

The Adani family and Total will ultimately hold 37.4% each, while public shareholders will own the remaining 25.2% in the firm that has set up city gas networks and won licences for many more.

Adani operates networks in Ahmedabad, Vadodara, Faridabad, Palwal and Khurja, and has started operations in many cities including Prayagraj, Chandigarh, Ernakulam and Bulandshahar, apart from winning many new licences, which makes it attractive for firms like Total.

Adani Group chairman Gautam Adani said that Total’s investment was a game changer for the company and that it was aligned with the vision of the government and the sector regulator. “It would transform Adani Gas as a world-class integrated gas distribution and fuel retailing company, catering to 8% of India’s population across 15 states with reliable and environment-friendly piped natural gas to over 6 million homes,” he said.

Total’s partnership with Adani includes regasification terminals in Dhamra in Odisha and also potentially in Mundra, Gujarat. Total is also looking at extending its partnership with Adani to the solar energy space, said Pouyanne.

Adani Gas aims to expand its distribution of gas in the next 10 years through its 38 concessions and market natural gas to industrial, commercial and domestic customers, as well as through 1,500 retail outlets of natural gas for vehicles, said Total.

International energy consultancy Wood Mackenzie said Adani Gas was attractive to Total for many reasons including having LNG terminals on the east coast, where there is less competition from other terminals.

India plans to raise the share of natural gas in the primary energy mix to 15% by 2030 from 6% now. The country imports half of its gas requirement.

The downstream regulator has recently awarded city gas licences for about 186 geographical areas, in which Adani Gas was one of the biggest winners of licences.

Adani and Total already have a joint venture that aims to build 1,500 petrol pumps across the country.

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