"So, if one of the companies keeps the shares of the other, it is a related party transaction.. ONGC will not be required to make an open offer to minority shareholders of HPCL after buying out government's 51. Government is 51 per cent owner of HPCL and 68 per cent owner of ONGC.In the present case, "In ONGC, I am transferring from direct government control to indirect holding," he said.ONGC already is majority owner of MRPL, which has a 15- million tons refinery. That time, IBP was being offered for outright sale, so when management chose to sell through bidding, the open offer got triggered," the official said, requesting anonymity. HPCL will continue to be a separate listed company.Way back in February 2002, state-owned Indian Oil Corp (IOC) had acquired government&Lengthening Socket Ratchet Wrenches39;s 33.8 million tonnes of annual oil refining capacity to ONGC's portfolio, making it the third-largest refiner in the country after IOC and Reliance Industries. Government will indirectly hold # stake in the company," he said. But that does not mean government has sold the company. "When upstream business is down, downstream does great and vice versa. So now ONGC will be able to better manage its risks," he said."It is a related party transaction which should not trigger takeover code unless the valuations are absurd.As per Sebi's takeover code, if a company acquires more than 25 per cent in another listed company, it has to make an open offer to minority shareholders to buy at least 26 per cent more in the target firm.From being a mere oil and gas producer, it will also have downstream oil refining and fuel retailing business.11 per cent stake in fuel retailing and marketing company Hindustan Petroleum Corp Ltd. If those conditions are satisfied, it will never happen.TheCabinet Committee on Economic Affairs(CCEA) last week gave in-principal approval ofOil and Natural Gas Corp(ONGC) buying out government's entire 51. Reliance Industries was among the bidders.ONGC will not need to make open offer as government's holding is being transferred to another state-run firm. "IOC and IBP merger had happened through bidding route. We have kept in mind interest of both ONGC and HPCL," the official said."Open offer is not required because the management complexion is not changing.11 per cent stake.68 crore and had to make an open offer for additional shares.11 per cent stake as the deal won't trigger takeover norms as did the IOC-IBP merger in 2002, a senior government official said.58 per cent stake in fuel retailer IBP Co Ltd for Rs 1,153. So it is a related party transaction," the officer said. "Through this vertical integration, what private sector could not achieve, the government has achieved," he added.The deal, which flows from Finance Minister Arun Jaitley's Budget announcement of creating an integrated oil company, will help ONGC spread its risks. New Delhi:ONGC will not be required to make an open offer to minority shareholders of HPCL after buying out government's 51.ONGC will not have to make an open offer to minority shareholders ofHPCLas the government's holding is being transferred to another state-run firm and the ownership isn't really changing.HPCL will add 23.

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