BENGALURU (Reuters) – French energy giant Total SA <TOTF.PA> will buy a 37.4% stake in Indian gas distribution company Adani Gas <ADAG.NS>, as it looks to capitalise on the South Asian country’s push for cleaner sources of energy.
Total is the third foreign oil major to enter India’s gas sector after BP Plc <BP.L> and Shell <RDSa.L>, and it comes at a time when India is spending heavily to cut its carbon emissions.
Indian Prime Minister Narendra Modi has set a target to more than double the share of gas in the country’s energy basket to 15% by 2030.
Total will buy up to 25.2% in Adani Gas from public shareholders at 149.63 rupees per share, representing an 8.7% premium to the stock’s last close and valuing the stake at 41.47 billion rupees ($584.80 million).
It will buy the remaining 12.2% stake from the Adani family, according to stock exchange filings.
After the deal, the Adani family and Total will each hold 37.4% stake in Adani Gas, while public shareholders will own the remaining 25.2%.
Total and Adani will also establish a joint venture to market liquefied natural gas (LNG) in India and Bangladesh.
Shares of Adani Gas soared 18.4% on Monday after the deal was announced, while the broader NSE index <.NSE> rose 0.3% in early trade.
(Reporting by Chris Thomas in Bengaluru and Nidhi Verma in New Delhi; Editing by Subhranshu Sahu)