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ICICI Ventures exits Prize Petroleum stake to HPCL

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ICICI Ventures has exited its stake in Prize Petroleum to Hindustan Petroleum Corporation (HPCL). The private equity firm owns 10% of Prize, with ICICI Bank and HDFC holding 35% and 5%, respectively. Each party is selling up, allowing HPCL, which already owns 50% of the asset, to take full control.

The transaction size has not been disclosed but is expected to be around INR100 million ($1.9 million), based on a purchase price of INR10 per share for 10 million shares, DealCurry reported. HPCL will also convert 50 million cumulative preference shares it currently holds at a face value of INR10 each.

Prize was set up in 1998 as HPCL's exploration and production arm, with the three external investors participating from the outset. It was awarded contracts to develop marginal fields in Hirapur, Khambel, West Bechraji and Sanganpur based on revenue sharing arrangements.

HPCL has been looking for a new partner in the venture for several years. Jaiprakash Associates reportedly agreed to buy ICICI Bank and ICICI Ventures' stakes in 2008, but the deal didn't go through. An attempt to raise a further $50 million in private equity funding in 2007 also failed.

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