National

Sembmarine Kakinada faces liquidation

P Manoj Mumbai | Updated on November 12, 2020

Attempts to revive Sembmarine Kakinada Ltd, the bankrupt ship repair and fabrication facility have hit a dead end with no responses to the call for EoI. The deadline ended on October 30.

Kolkata-based defence PSU Garden Reach Shipbuilders & Engineers Ltd (GRSE) and Chowgule and Company Pvt Ltd had shown preliminary interest but did not submit EoI, multiple sources said.

Sembmarine Kakinada is a joint venture between Sembcorp Marine Repairs & Upgrade Pte Ltd holding 36 per cent stake, Kakinada Infrastructure Holding Pvt Ltd (38 per cent) and India Infrastructure Pte Ltd (26 per cent).

Sembcorp Marine Repairs is a unit of Singapore-listed Sembcorp Marine Ltd, one of the world’s top oil rig builders.

Sembmarine started operations in 2009 from the premises of Kakinada Deepwater Port run by Kakinada Infrastructure Holding.

A bankruptcy court in Amaravati, Andhra Pradesh, initiated insolvency proceedings against Sembmarine Kakinada after Axis Bank filed a petition seeking to recover dues of ₹491.57 crore. The ship repairer and fabricator owed ₹897.50 crore to a clutch of financial creditors that includes Bank of India, Indian Overseas Bank, Union Bank of India and Standard Chartered Bank.

The yard sought to tap the market for offshore structure work given its strategic location on the east coast, about 100 nautical miles from the KG Basin area. It has a 12-metre draft approach channel compared to 4-9 metres in other shipyard locations. Its Floating Dry Dock has a lifting capacity of 13,500 tonnes to accommodate vessels up to 54,000 dead weight tonnes (DWT).

Sembmarine Kakinada would become the third private yard, after ABG Shipyard Ltd and Bharat Defence and Infrastructure Ltd, to go down under the weight of huge debt in the past two years. The corporate insolvency resolution process of Reliance Naval and Engineering Ltd (RNAVAL) is underway.

Published on November 12, 2020

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