NEW DELHI, OCTOBER 25: While the goverment is mulling splitting up IPCL before it is sold off, the two top contenders for the public sector unit appear to be cool to the offer. More so since, according to industry, splitting it up could delay the divestment by anywhere between 6 months to a year. Prospective bidders like Reliance, for instance, have done their due diligence on the basis on all the units being sold together - according to industry sources, if the government now decides to split IPCL, the due diligence will have to be done all over again. More important, if the government splits up IPCL, it will also have to apportion IPCL's liabilities between all the plants. This itself could take several months. Even the state-owned IOC, which is keen to grab the Baroda unit of IPCL as it supplies this unit naphtha from its Koyali refinery, is not certain it will bid for all the units separately. According to sources, the other two IPCL units are gas-based, and so there is no great reason for IOC to want to bid for them. The reason why the government is now mulling breaking up of IPCL is because the erstwhile Disinvestment Commission had said that no company should be allowed to bid for IPCL if this lead to the creation of a monopoly - essentially, this ruled out Reliance Industries from bidding for the company. This monopoly clause, however, was subsequently dropped when the Cabinet cleared the sale of IPCL - in recent months, however, the matter came up again. When contacted by The Indian Express, senior officials in the Department of Divestment stated that breaking of IPCL is one of the options the government is considering at present. However, other options are also being looked into and the government would come out with a decision on IPCL in a month's time, officials added. Some experts debunk the `monopoly' argument, arguing that, taken together, the IPCL-Reliance share in the domestic polymer market would be around 68 per cent, and 65 per cent for the fibre market. IOC officials, however, debunk this statistic, arguing that IPCL-Reliance's combined share in both these markets will be in the region of 80 per cent.
