Shell India is the local arm of the Royal Dutch Shell Plc based in Netherland. The company quit the city gas business in India this Tuesday after it sold its 10 percent of its stake in Mahanagar Gas Ltd for Rs 770 crore.

If stock exchange data be concerned, BG Asia Pacific Holdings which happens to be a wholly-owned subsidiary of Shell, sold 9.98 million shares in the company through block deals at Rs 780 apiece.

Majority of the stake at Mahanagar Gas Limited is owned by Gail India Ltd. The company sells compressed natural gas to automobiles and supplies piped-cooking gas to households in and around Mumbai.

Back in July 2016, when MGL was listed, GAIL and Shell held 32.5 percent stake each in the company. Last year, Shell is known to sell 24 percent of its shareholding in two tranches, 8.5 percent in April and 14 percent in the month of August, in the open market through bulk deals.

Maharashtra government is known to hold 10 percent shareholding in MGL, while the remaining is with the public.

Shell sold its stake in the open market after Gail waived off its first right of refusal.

According to the shareholding agreement, partners have the first right to buy in case either of them wants to exit.

A senior GAIL officer said:

“We already have a controlling stake. What purpose would it have served to buy the additional stake at market price.”

According to him the price of the sale was too high.

He also added:

“It doesn’t make any sense for us to buy the stake at the market price.”

Last year, in the month of April Shell first started diluting its stake in MGL. The company had stated that this was:

“part of Shell’s ongoing portfolio optimization to transform Shell into simpler company, delivering stronger returns.”

It also stated:

“Our investment in the Hazira LNG receiving terminal in Gujarat and the recent creation of Shell energy India, our gas marketing and trading business, shows our commitment to grow in India and to increase gas presentation in the country.”

Shell planned to quit the city gas distribution business as the lock-in period for minimum promoter holding after the listing of a company expired in the last month. In June 2016, MGL was listed and the three-year lock-in period, according to the market regulator’s listing norms expired on

Shell quits city gas business in India, sells MGL stake in the open market