The Cabinet Committee on Economic Affairs (CCEA)
Thursday approved the merger of India Oil Blending Ltd (IOBL) with its
parent company Indian Oil Corporation Ltd (IndianOil), a state-owned
refining and marketing major.


"The proposed amalgamation will help the merged entity to achieve size,
scale, integration and greater financial strength and flexibility in
maximising the shareholders' value," an official statement issued said.

Chaired by Prime Minister Manmohan Singh, the CCEA felt "the merged entity
is likely to achieve higher long-term financial returns than could be
achieved by the companies individually".

The government has authorised the two companies to take follow up action and
decide on the merger date.