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Firm plans to tie up the loan with SBI, PNB, UBI and others
Pipavav Defense and Offshore Engineering Company, earlier Pipavav Shipyard, plans to raise Rs 1,200
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crore ($250 million), as a term loan from the domestic market, largely to fund the development of a second dry dock, which once completed would be the worlds largest such repair yard for ships.
The company plans to tie up the loan from around five nationalised banks, including State Bank of India (SBI), Union Bank of India and Punjab National Bank. We have already tied up around 80 per cent of the loan and expect the rest to materialise soon, a senior company official told Financial Chronicle.
The cost of borrowing is expected to be around 13 per cent per annum, but the company hopes to replace these with foreign currency denominated loans raised from global markets at a later date. We may look at cheaper loans in the form of external commercial borrowings (ECBs) some time later to prepay our costly loans, the official said.
Pipavav had committed an investment of around $1 billion (Rs 4,739.53 crore) towards its shipyard, where it is now executing around $1.2 billion (Rs 5,697.44 crore) worth of orders. We have already invested around $750 million, while the rest $250 million that we are raising would make up the balance investment committed, he said.
The company has also initiated a joint venture with the Mazagon Dock to help the latter execute around Rs 100,000 crore orders to build warships, submarines and offshore naval vessels. Though we may need some additional investments to meet the forthcoming challenge in the form of orders from Mazagon dock, our current infrastructure is capable of building around 12 warships at any given time if Mazagon Dock needs it. Besides, once the second dry dock is complete, it would add to our capacity further, the official said.
The first dry dock, which is the second largest in the world, could accommodate ships up to 400,000 dead weight tonnes. This facility can build around 32 Panamax ships a year. For the JV, Pipavav will make available its capabilities in shipbuilding and fabrication and leverage its tie-ups with foreign firms such as Northrop Grumman and Babcock Group UK in areas of defense. The JV will allow Pipavav to extend its capabilities to making large submarines. The company is also looking at exporting from its shipyard in the near future, Pipavav chairman Nikhil Gandhi recently said.
---------- Post added at 06:48 AM ---------- Previous post was at 06:46 AM ----------
Pipavav seeks Rs 1,200 cr debt for second dry dock | mydigitalfc.com
Pipavav Defense and Offshore Engineering Company, earlier Pipavav Shipyard, plans to raise Rs 1,200
RELATED ARTICLES
SBI says rights issue in 2-3 months
Pipavav, Mazagaon Dock to set up joint venture
Interest rates to remain high: SBI
Govt likely to approve SBI capital infusion proposal soon
Pipavav zooms up on bourses in morning trade
crore ($250 million), as a term loan from the domestic market, largely to fund the development of a second dry dock, which once completed would be the worlds largest such repair yard for ships.
The company plans to tie up the loan from around five nationalised banks, including State Bank of India (SBI), Union Bank of India and Punjab National Bank. We have already tied up around 80 per cent of the loan and expect the rest to materialise soon, a senior company official told Financial Chronicle.
The cost of borrowing is expected to be around 13 per cent per annum, but the company hopes to replace these with foreign currency denominated loans raised from global markets at a later date. We may look at cheaper loans in the form of external commercial borrowings (ECBs) some time later to prepay our costly loans, the official said.
Pipavav had committed an investment of around $1 billion (Rs 4,739.53 crore) towards its shipyard, where it is now executing around $1.2 billion (Rs 5,697.44 crore) worth of orders. We have already invested around $750 million, while the rest $250 million that we are raising would make up the balance investment committed, he said.
The company has also initiated a joint venture with the Mazagon Dock to help the latter execute around Rs 100,000 crore orders to build warships, submarines and offshore naval vessels. Though we may need some additional investments to meet the forthcoming challenge in the form of orders from Mazagon dock, our current infrastructure is capable of building around 12 warships at any given time if Mazagon Dock needs it. Besides, once the second dry dock is complete, it would add to our capacity further, the official said.
The first dry dock, which is the second largest in the world, could accommodate ships up to 400,000 dead weight tonnes. This facility can build around 32 Panamax ships a year. For the JV, Pipavav will make available its capabilities in shipbuilding and fabrication and leverage its tie-ups with foreign firms such as Northrop Grumman and Babcock Group UK in areas of defense. The JV will allow Pipavav to extend its capabilities to making large submarines. The company is also looking at exporting from its shipyard in the near future, Pipavav chairman Nikhil Gandhi recently said.
---------- Post added at 06:48 AM ---------- Previous post was at 06:46 AM ----------
Pipavav seeks Rs 1,200 cr debt for second dry dock | mydigitalfc.com
