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An international strategic investor has agreed to pick up 10 per cent equity stake in Pipavav shipyard in Gujarat for Rs 900 crore.
Pipavav Defence and Offshore Engineering Company, which owns the shipyard, said on Tuesday that the company's board has decided to issue 81.88 crore equity shares representing 10 per cent of the paid-up capital of the company to an international strategic investor on a preferential basis at a price not less than Rs 110 per share.
The preferential issue price is nearly double the current market price of the share. The company shares, which touched a 52-week low on Monday, rose by 2.83 per cent to Rs 58.15 following the announcement on Tuesday.
Investor name not disclosed
The company has not disclosed the name of the investor. In a notice to the stock exchanges it said “the investor will initially pick up five per cent of the equity and with in specified time will increase its holding up to 10 per cent.”
The investor, “a leading and extremely reputed global conglomerate with strong interest in the defence sector,” will bring in critical technology required for manufacture of complex and critical equipments and systems require for armed forces, the notice said.
The investor will have the right to nominate one representative on the board.
There have been reports in the past quoting promoters saying that several investors have shown interest in picking up the stake in the company.
The Nikhil-Gandhi promoted company has been in the news recently following its controversial tie-up with Mazgaon Dock for manufacturing warship.
The company's board has also decided to increase the authorised capital by Rs 200 crore to Rs 1,000 crore.
The company has reported a net profit of Rs 9.14 crore for the quarter ended September 30, 2011.
The shipyard has delivered a 74,500 DWT panamax bulk carrier, said to be the largest bulk carrier built in India.
Recently the company has also announced the plan to set up an aircraft maintenance, repair and overhaul unit in India jointly with an Airbus group company.
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