Edelweiss ARC in talks to bring foreign investment worth $100M in Bharati Shipyard

Edelweiss Asset Reconstruction Co Ltd (Edelweiss ARC), a wholly-owned subsidiary of Edelweiss Financial Services Ltd, is looking to channel investment worth up to $100 million (Rs 634 crore) for debt-laden Bharati Shipyard Ltd.

This fund infusion, which could take various forms including investment from strategic investors, will help in resuming the construction of the balance of the total 64 vessels, a company spokesperson told VCCircle. He added that the fund infusion is expected by April 2015.

The report of the proposed fundraising was first published The Economic Times.

Promoted by Prakash Kapoor and Vijay Kumar in 1973, the firm, which was once India’s second-largest private shipyard, is laden with debt which has become non-performing assets for the lenders. Edelweiss ARC had bought 60 per cent of the outstanding loans from a State Bank of India-led consortium of bankers. It is looking to bring the remaining debt under its fold to make it easier to restructure the loans.

Bharati Shipyard manufactures ships, including offshore supply vessels, multi-purpose support vessels, anchor handling tugs, cargo/container ships and tankers. The company operates four shipyards located at Ratnagiri, Ghodbunder, Kolkata and Goa.

Edelweiss ARC had pumped in Rs 35 crore into the firm which helped BSL complete the construction of the partly-built naval vessel, which has already been delivered. BSL have launched (landing into water) yet another offshore vessel for the coast guard which will get delivered by mid January 2015. A total of eight coast guard vessels and five naval vessels (total 13), are being taken up in the first instance, of which, one navy vessel is already delivered.

Edelweiss ARC is channelling up to Rs 100 crore afresh by next month, and this would help Bharati Shipyard complete the construction of the balance 17 partly built naval and coast guard vessels apart from the 13 vessels already taken up.

Once $100 million is pumped in, all the six shipyards will go full pelt, the company said.

Recently, it sold its wind power business for Rs 55 crore.

(Edited by Joby Puthuparampil Johnson)

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