ONGC free to sell stake in HPCL: Pradhan

Amid reports of ONGC's inability to derive any benefit out of its HPCL acquisition, Oil Minister Dharmendra Pradhan on Monday said the state-owned firm was free to sell its stake in the oil refining and marketing company.

In its most expensive acquisition ever, Oil and Natural Gas Corp (ONGC) last year paid Rs 36,915 crore to buy government's entire 51.11 per cent stake in Hindustan Petroleum Corp Ltd (HPCL).

Despite being the majority stakeholder in the company, ONGC has only got one member on the board and virtually no say in the management.

HPCL didnt even recognise ONGC as its promoter for almost one-and-half-years before a Securities and Exchange Board of India rap forced it to list its majority owner as a promoter.

Since acquiring the stake, ONGC has only been able to appoint one director to that firm's board.

HPCL head Mukesh K Surana continues with the title of Chairman and Managing Director despite corporate governance structure mandate of only one chairman in a group and subsidiaries being headed by managing directors or chief executive officers (CEOs).

When asked if the government had given ONGC nod to sell stake in HPCL, Pradhan told reporters that "These are market decisions. They are autonomous companies. They are free to take their own decision at appropriate time."