Steel Tycoon Jindal Keen to Acquire Bankrupt Indian Shipyard
(Bloomberg) -- Jindal Steel & Power Ltd., India’s third-largest producer of the alloy by market value, and two other groups were the latest to express interest in bidding for Reliance Naval & Engineering Ltd., according to people familiar with the matter.
For Jindal Steel, controlled by Naveen Jindal, Reliance Naval can be a captive client for the company’s shipbuilding plates, said Vidya Rattan Sharma, managing director at the steelmaker, who confirmed Jindal’s interest. Dubai-based shipping firm GMS and Kotak Special Situations Fund were among the others that registered to bid as of the Feb. 28 deadline, according to the people, who asked not to be identified as the matter is private.
The process to find a buyer for the indebted shipyard, once controlled by former billionaire Anil Ambani, began in May with deadlines being extended four times already. A successful sale of Reliance Naval will help creditors including IDBI Bank Ltd. and State Bank of India recoup part of the company’s 108 billion rupees ($1.5 billion) of debt.
GMS, one of the world’s largest buyers of ships for recycling, the Kotak fund and Sudip Bhattacharya, the insolvency resolution professional for Reliance Naval, didn’t immediately respond to emails for comment.
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“We are looking at it in two ways,” Jindal Steel’s Sharma said in an interview. “One is the strategic location as it is port based and the other is that it can be a good outlet to consume our own plates.”
Jindal isn’t partnering with any company for the bid, Sharma said. The company’s shares fell 2.1% in Mumbai on Tuesday.
The port unit of A.P. Moller-Maersk A/S, the world’s largest container carrier, and 11 other groups had bid for the asset last year. Maersk’s unit though pulled out, the Hindu Businessline reported in October.
Reliance Naval is “naturally interesting” for Maersk’s APM Terminals, the company said in response to a query on Tuesday. “However, it would be too early to say whether the RNEL restructuring will result in a realistic business opportunity for us.”
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