You are here: Home » News-CM » Companies » News
Business Standard

Reliance Industries proposes independent subsidiary for O2C business

Capital Market 

Reliance Industries has proposed to reorganize the company's O2C (oil to chemicals) business. The company has initiated the process of carving-out O2C Business into an independent subsidiary.

Rationale for O2C business reorganization - 1. Independent growth company enables focused pursuit of opportunities across O2C value chain 2. Enhanced efficiencies through self-sustaining capital structure and dedicated management team 3.

Facilitates value creation through strategic partnerships and attract dedicated pools of investor capital 4. Reorganization will be beneficial to all stakeholders of RIL Management control of O2C continues with RIL Existing O2C operating team moves with transfer of business No dilution of earnings or any restriction on cash flows RIL is expected to retain its investment grade international (BBB+/ Baa2), and domestic AAA credit ratings

The O2C subsidiary will comprise the refining and petrochemicals business of Reliance Industries including Reliance BP Mobility (fuel retail subsidiary 51% owned by O2C and 49% by BP); Reliance Global Energy Services (Singapore) and Reliance Global Energy Services (UK) (both 100% trading subsidiaries); Reliance Ethane Pipeline (100% subsidiary Dahej - Nagothane Pipeline); and Reliance Sibur Elastomers (74.9% JV company with Sibur at Jamnagar).

O2C to also comprise of following subsidiaries being transferred outside of O2C Scheme - RIL USA, Inc (trading subsidiary) Recron (Malaysia) Sdn. Bhd. (manufacturers polyesters and textiles in Malaysia) RP Chemicals (Malaysia) Sdn. Bhd. (Manufactures PTA in Malaysia) Reliance Petro Marketing (Packed LPG and Lubricants business in India)

The O2C scheme becomes effective 01 January 2021 (appointed date) subject to approval shareholders, creditors, regulatory authorities, and NCLT Mumbai and Ahmedabad. The approval process has already commenced and is expected to be completed in Q2 FY22.

Powered by Capital Market - Live News

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Tue, February 23 2021. 12:08 IST