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10% stakes in the joint venture between IOCL and CPCL will be purchased by ICICI Bank, Axis Bank, and others.

On Friday, ICICI Bank, Axis Bank, and SBI Life Insurance announced that they will each buy a 10% stake in a proposed joint venture between Chennai Petroleum and Indian Oil Corporation.
ICICI Bank, Axis Bank, and SBI Life Insurance will each invest 50,000 to acquire a 10% interest in the target firm, which will be formed with seed capital of 5 lakh apiece.
In its regulatory filing, ICICI Bank also said that, “Except for the first seed capital commitment of 50,000, it has no obligation to fulfil the future equity requirements of the Project.”
“It is originally intended to establish the Target entity with a seed capital of Rs. 5 lakh, of which 10% of the Target entity’s total paid-up capital will be contributed by the Acquirer, Axis Bank Limited (“Bank”). Beyond its first seed capital investment of Rs. 50,000, the Bank, as a seed equity investor, has no obligation to finance the Project’s future equity requirements, according to Axis Bank’s regulatory filing.
The Acquirer, SBI Life Insurance Company Limited, will invest 10% of the Target entity’s total paid up capital in the seed capital, which is initially proposed to be Rs. 5 lakhs.
In its statement, SBI Life Insurance Company Limited said that, aside from its initial seed capital commitment of Rs. 50,000, it has no further obligations to meet the Project’s future equity requirements.
The transaction will be finished 180 days after the joint venture agreement’s signing.
A nine million metric tonne per year refinery is what the joint venture between Indian Oil Corporation (IOCL) and Chennai Petroleum plans to build in Nagapattinam, Tamil Nadu. Together, Indian Oil Corporation and Chennai Petroleum Corporation will own 50% of the company, or 25% each.
Petroleum products must be produced by the refinery.
Axis Bank moved up 0.4% to $879 on the BSE, while ICICI Bank’s stock finished 1.12% higher at $937.40.
On the BSE, CPCL increased by 4.18 percent to 199.50 and IOCL increased by 3.08 percent to 72.05.
On November 23, 2022, Axis Bank signed into an agreement relating to an initial investment in the seed equity capital of the proposed Joint Venture (JV) of Chennai Petroleum Corporation (CPCL) and Indian Oil Corporation (IOCL) (the target entity) (to be incorporated). The target company is a 9 MMTPA refinery in Nagapattinam, Tamil Nadu, where IOCL and CPCL will each own 25% of the equity and hold the remaining 50% along with other JV partners.
Following the transaction, Axis Bank would acquire 5,000 equity shares with a face value of Rs. 10 apiece, giving it a 10% ownership stake in the target company.

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