Reliance Infrastructure (RInfra) has managed to mop up 17 per cent shares through the open offer route for the acquisition of Pipavav Defence and Offshore Engineering Co. The open offer, which closed on Wednesday, has increased RInfra’s stake in the company to 35 per cent.

Sources in RInfra said the company was seeking 26 per cent shares through the open offer but managed only 17 per cent for which ₹850 crore has been spent at ₹66 a share. Institutional investors have not sold their stakes in the company and have decided to stay invested in the company. From the original promoters of Pipavav Defence, RInfra has managed to acquire 18 per cent stake at ₹819 crore, valuing the shares at ₹63 apiece.

Reconstitution of board A media statement issued by the company said after completion of applicable formalities, RInfra will have sole management control of Pipavav Defence. The company’s board would be reconstituted and renamed Reliance Defence and Engineering. Payment for the valid shares, which would be subject to scrutiny, will be completed by December 31.

RInfra is attempting to steer Pipavav Defence back into financial health by bringing in a new management and exiting the corporate debt restructuring (CDR) package. It is heavily betting on the Pipavav Defence shipyard for future orders from the Indian Navy and the Coast Guard.

Pipavav Defence was the first private company in the country to obtain the contract and licence to build warships. The ship fabrication facility is spread over 2.1 million square feet. The shipyard has a pre-erection berth of 980 metres length and 40 metres width, and two cranes with a combined capacity of 1,200 tonnes.

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