Shares of state-owned Oil and Natural Gas Corporation were gaining on Tuesday after it announced its overseas unit was aiming to merge five of its units into itself.

What Happened: Imperial Energy Ltd (IEL), an overseas subsidiary of ONGC, has unveiled plans to integrate five of its downstream subsidiaries into its operations, as per a regulatory filing on February 19.

Shareholders of IEL have greenlit the “merger of five entities” — Imperial Energy Cyprus Limited (IECL), Imperial Energy Nord Limited (IENL), Redcliffe Holdings Limited (RHL), Biancus Holding Limited (BHL) and San Agio Investment Limited (SAIL) — into IEL, which acts as the consolidating entity, according to the exchange filing.

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This approval, granted on February 19, awaits the green signal from the Cypriot court, under whose jurisdiction IEL and its subsidiaries are incorporated.

IEL is a wholly-owned subsidiary of ONGC Videsh Ltd (OVL), which spearheads ONGC’s international business, headquartered in New Delhi.

However, two other downstream subsidiaries of IEL, namely Imperial Frac Services Cyprus Limited (IFSCL) and Imperial Energy Tomsk Limited (IETL), will remain outside the purview of the merger process.

The plans to merge downstream subsidiaries come a week after ONGC reported a decline in its bottom line for the quarter ended December 2023. The company’s net profit stood at ₹10,356 crore, marking a 9.9% drop compared to ₹11,489 crore in the corresponding period last year.

Revenue from operations also saw a 2.2% year-on-year dip to ₹1.66 lakh crore compared with ₹1.69 lakh crore in the October-December period of FY23.

Price Action: ONGC’s share price was up 1.51% at ₹278.8 near the start of trade on Tuesday.

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