The inter-ministerial group on divestment in oil marketing and refining PSU Hindustan Petroleum Corporation is likely to meet in a day or two to give finishing touches to the draft shareholders' agreement for circulation among bidders for their comments.

The meeting assumes importance in the wake of due diligence that the government is likely to start by early next month for divestment of 34 per cent equity in HPCL, where global oil majors Shell, Kuwait Petroleum, Saudi Aramco and British Petroleum are vying with domestic giants like Reliance and Essar.

The officials from the ministries of finance, petroleum and divestment will meet later this week to discuss the programme for divestment including setting up data room and pre-bid meetings before deciding to call financial bids possibly in November, sources associated with the divestment process said.

Meeting is expected to take stock of the progress made so far and work towards finalising modalities for starting the due diligence.

Divestment Minister Arun Shourie had last week said that work on setting up the data room for HPCL was on but clarified that due diligence has not started.

The Cabinet Committee on Divestment at its January 26 meeting decided in favour of strategic sale of HPCL, while favouring a public offering for BPCL.

In case of HPCL, HSBC was appointed as advisors for the deal.

The government will divest 34 per cent stake to strategic partner, while reserving another 5 per cent for employees.

In case of BPCL, 35 per cent would be offered through public offer route, while another 5 per cent would be set aside for employees, allowing the government to retain 26 per cent.

The company has a paid up capital of Rs 300 crore (Rs 3 billion) employing over 12,00 people while in the case of HPCL the paid up capital is placed at Rs 338 crore (Rs 3.38 billion) with a staff strength of 11,357.