ABG Shipyard ups ante for Great Offshore; Bharti may follow suit
30 Jul 2009
Offshore oil and gas services provider Great Offshore Ltd said on Thursday that private sector shipbuilder ABG Shipyard Ltd has revised its open offer price to buy 32 per cent in Great Offshore to Rs450 each, countering a bid by rival shipbuilder Bharati Shipyard Ltd.
On Wednesday, ABG, along with a unit Eleventh Land Developers, acquired 1.9 million shares, or an additional 5.2 per cent of Great Offshore, at Rs450 rupees through open market transactions. ABG told the Bombay Stock Exchange that this would increase its stake in Great Offshore to 7.3 per cent.
Earlier this month, Bharati Shipyard had made an open offer for Great Offshore at Rs405 a share. ABG's latest offer is about 11 per cent more than this. Bharati owns 19.5 per cent of Great Offshore, and is widely expected to increase its offer to exceed ABG's. The two companies have time till 24 August to change their offer price.
The development is likely to intensify the battle for Great Offshore, which provides offshore drilling and logistics services to oil and gas firms. It became a takeover target after its promoter Vijay Sheth failed to pay margin calls for his pledged shares and lost control of the company earlier this year.
Bharati and ABG are keen on expanding into the lucrative offshore oil services business. The shortage of basic equipment such as rigs and supply vessels caused a huge spike in prices of offshore services.
Purchase of Great Offshore will also make either of the two companies more integrated as they make the ships and supply vessels that are used by offshore oilfield firms.
