Punj Lloyd sells Pipavav Shipyard stake to co-promoter SKIL
29 Mar 2010
Delhi-based engineering and construction major Punj Lloyd has exited Pipavav Shipyard by selling its 19.43-per cent stake to co-promoter SKIL Infrastructure for Rs656 crore. The shares would be sold at Rs50.75 each. They were bought at Rs27 each for a total of Rs350 crore in September 2007.
Confirming the news, executive vice-chairman of Pipavav Shipyard Bhavesh Gandhi said, ''Punj Lloyd's exit is a strategic decision by both co-promoters.'' SKIL would consolidate its position in the company, he added. ''Punj Llyod's exit gives SKIL an opportunity to increase its stake at an important juncture.''
The acquisition would be made on SKIL's books and not Pipavav's. ''SKIL's balance sheet is strong enough to be able to raise resources for the deal,'' Gandhi told CNBC-TV18 in an interview.
To a question, Gandhi said there were absolutely no differences between the promoters. ''It is a strategic decision that both parties have taken and from the SKIL's point of view, it consolidates our position and demonstrates our commitment into the project by going for this purchase of equity from Punj Lloyd,'' he said. He added that on Punj Lloyd's part, it was making an almost 100 per cent profit from the transaction.
He said he would not need to pledge more of his stake in the company to raise the capital for the mandatory open offer. ''SKIL has its own strengths as far as its balance sheet is concerned. It is good enough to raise large amount of capital. In fact, if you recall in 2008, it had raised the equity in SKIL from companies like AIG at a valuation of about $3.5 billion,'' he said.
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