AG&P Pratham, backed by I-Squared Capital, and Think Gas Distribution are in the planning stages of a substantial $1.1 billion merger. This proposed consolidation, structured as a stock-for-stock exchange, is aimed at enhancing operational efficiencies within India’s city gas distribution sector.
AG&P Pratham, a subsidiary of AG&P Group, is a leading provider of energy solutions, focusing on the development and operation of city gas distribution (CGD) networks in India. With a commitment to clean and sustainable energy, AG&P Pratham aims to deliver safe, reliable, and affordable natural gas to households, industries, and commercial establishments.
Think Gas is a dynamic player in the Indian energy sector, specializing in the distribution of natural gas and related services. The company is known for its innovative approach and commitment to customer satisfaction. Think Gas focuses on developing robust infrastructure and delivering clean energy solutions to meet the growing demands of the market.
Notably, I-Squared Capital currently holds a 100 per cent stake in Think Gas Distribution and a 73 per cent stake in AG&P Pratham. The strategic intent behind this merger is to strengthen their competitive position vis-à-vis major players like Mahanagar Gas and Gujarat Gas. Post-merger, Osaka Gas and Sumitomo Corp are set to inject approximately $200–250 million as primary capital.
This initiative will result in I-Squared Capital emerging as the dominant entity in the merged corporation, while AG&P and the Osaka Gas-Sumitomo consortium will also hold substantial stakes. The merger received approval from the European Commission in February. India’s ambitious goal of increasing the share of natural gas in its energy mix to 15 per cent by 2030 highlights the strategic importance of city gas distribution networks.
This consolidation aligns with government efforts to expand gas infrastructure, particularly in the Northeastern and Jammu and Kashmir regions. Despite efforts to reach AG&P, Think Gas, I-Squared Capital, Osaka Gas, and Sumitomo for comments, no responses have been received.
However, it is widely anticipated that the merger will lead to unified management, with AG&P’s managing director expected to lead the new entity. This merger is seen as a major step towards establishing a comprehensive presence across India. Reports in May 2023 hinted at potential investments in Think Gas by Sumitomo, Mubadala Investments, and Tokyo Gas, alongside discussions of a merger.
Think Gas, founded in 2018, operates in several Indian states, providing natural gas to various industries. AG&P, headquartered in Singapore, holds 12 CGD licenses through AG&P Pratham, covering a significant portion of India’s landmass across five states.
