Kolkata: Indo-British Petroleum (IBP) & Co Limited, the oil marketing public sector undertaking (PSU) which had been recently acquired by Indian Oil Corporation (IOC) on disinvestment, is not going to worry about product sourcing any longer, its chairman S N Mathur said.

In his first news conference after disinvestment, Mathur told reporters that the biggest advantage which IBP would derive from the strategic partner is secured supply of petroleum products from IOC.

Before this, IOC had been lifting products from different oil companies as per the directions of Oil Co-ordination Committee.

In an informal talk with reporters, Mathur said that the other biggest advantage which had accrued to IBP was that the company had become totally debt-free.

Mathur said that IBP had been able to retire all its debts before the disinvestment by selling stakes in Numaligarh Refinery and Oil Tanking Limited.

Commenting upon the bid price, Mathur said that it reflected IBP's retail excellence and the worth of the company had been recognised.

To acquire 33 per cent stake in IBP, IOC had bid at a price of Rs 1551.25 per share, which was twice the closing price of the scrip on the BSE on February 4, a day before the announcement of the highest bidder by the government.

The other prominent bidders were Reliance, Shell, and Kuwait Petroleum among others.

When asked whether there was a possibility of a merger between IOC and IBP, Mathur said that this was not a possibility in the immediate future, however adding that nothing could be predicted about the long term.

Mathur categorically said that it was expected that IOC would retain the IBP brand name after the acquisition.

When asked about the composition of the future IBP board, Mathur said that government would have two nominees as its holding would be 26 per cent.

Regarding the number of IOC nominees on IBP board, Mathur said that it would be decided once the public offer was over which would be over within a week.

Mathur said that IBP's profits were sure to rise once the government dismantled the Administered Pricing Mechanism (APM).

About IBP's investment plans, Mathur said that the company would spend to upgrade the retail outlets. He also said that some of the company's outlets might have to close down once APM was dismantled.

Mathur said that pumps which were having poor sales volumes would have to close down as they would not be able to withstand price competition in the market.

The next board meeting of IBP would be held sometime next week.

PTI