Reliance looks overseas

MUMBAI - Reliance Industries, India's biggest company, bid for bankrupt chemicals and fuels maker LyondellBasell Industries, as it seeks to take advantage of the global financial crisis to expand overseas.

The refiner and energy explorer controlled by billionaire Mukesh Ambani offered an undisclosed amount of cash to buy a controlling stake in US-based LyondellBasell. The Mumbai-based company may have to pay at least US$12 billion ($16.5 billion), the Times of India reported.

Tony Regan, a consultant at Tri-Zen International in Singapore cautioned: "It's an opportunistic purchase if the company is bankrupt, but there's a reason why those assets are cheap."

Reliance joins India's Essar Group in bidding for plants overseas as declining fuel demand and processing margins prompt Royal Dutch Shell and Exxon Mobil to sell assets. Ambani, armed with US$4.2 billion in cash, said last week that global acquisitions were the key to boosting revenue.

If the Lyondell deal was completed, it would be the biggest by an Indian firm since Tata Steel bought Corus Group for US$12 billion in 2007.

Reliance's stock has gained 72 per cent this year, giving the company a market value of about US$75 billion.

Reliance has said it is looking for assets abroad to reduce the risk of investing mostly in India, where the company has been battling a lawsuit with a firm owned by Mukesh's estranged brother, Anil Ambani.

About 97 per cent of Reliance's assets are in India.

- BLOOMBERG