Litro Gas restructuring : Eight bidders selected
In the state-owned Litro Gas restructuring, eight bidders have been selected by the State-Owned Enterprises Restructuring Unit (SRU), from the 14 who had submitted proposals, informed sources said.
Epdesa Pte Ltd (Singapore), Bharat Petroleum Cop. Ltd. (India), Ayaz Anonim Sirketi (Republic of Türkiye), SiamGas and Petrochemicals Public Company Limited (Thailand), BGN Int DMCC (UAE), Confidence Petroleum India Limited (India), OQ Trading Limited (UAE), Tristar Group (UAE), Laugfs Gas PLC (Sri Lanka), United Petroleum Holdings (Malaysia), Vitol Asia Pte Ltd (Singapore), Infinity NGC (Sri Lanka), China National Aero Techno (Sri Lanka) and Consulting Engineers & Contractors (Sri Lanka) were the fourteen parties that bid for the Litro Gas which is partly owned by General Treasury of Sri Lanka through the Sri Lanka Insurance Corporation, according to official sources. They refused to disclose the eight successful bidders moving into for the final round of selection.
The divestiture process was a two-stage competitive bidding process, with Deloitte Touche Tohmatsu India LP appointed as the Transaction Advisor. The timeline to express interest closed on March 1, the sources said.
The state-owned restructuring has taken too long, top officials said, but noted that one cannot be too careful. “It shouldn’t have taken this long, but each change that we make in the process has to be vetted by the cabinet, which introduces delays. It is a nightmare. Also, we have past cases where courts have reversed the restructuring processes as the due process wasn’t followed,” a top official told the Business Times on Thursday.
When selling a government asset, there is a minimum—time required to do the sell-side regulatory, legal, and financial due diligence, he added, highlighting the long process of running an international standard and pre-selecting the bidder.
Officials also lamented that the entire government mechanism in this restructuring process has been as ‘disablers’ (finding fault with the system) and not ‘enablers’. “Also, the negative vibes about Sri Lanka prohibits anybody from looking at the process positively,” a second official said.
The state-owned enterprise holding company law has still not been passed, which is a concern, he added.
When asked why the all-or-nothing board of the Columbus Stock Exchange was not an option in this process, he said the government has the say in the process of selecting the bidders. “There is a predefined process approved by the cabinet. There is a detailed process with divestiture guidelines. It is a two-envelope single-round procedure.”
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