Hindustan Petroleum Corporation Limited (HPCL) is likely to acquire Mangalore Refinery and Petrochemicals Limited (MRPL) in a share-swap deal to become India’s second largest oil refiner. The merger is likely to take place after the Oil and Natural Gas Corporation (ONGC) completes the acquisition of HPCL (by December 2017 or January 2018). At present, ONGC owns a 71.63 per cent stake in MRPL while HPCL has 16.96 per cent. Post ONGC’s acquisition of HPCL, ONGC will have two refinery subsidiaries, HPCL and MRPL. HPCL can acquire MRPL either by buying out ONGC’s shares or through a share-swap, wherein ONGC will get more shares in HPCL in lieu of giving up control in MRPL. Further, ONGC is likely to sell some of its stake in Indian Oil Corporation Limited (IOCL) to institutional investors like the Life Insurance Corporation of India to part-fund its over Rs 340 billion acquisition of HPCL.