Great Offshore battle heads for Diwali climax

The battle for control of drilling company Great Offshore looks like reaching a climax in the Diwali season, with both contenders, Bharati Shipyard and ABG Shipyard, saying they were expecting Securities and Exchange board of India approval for their open offers within two weeks.

Mumbai-based shipbuilder Bharti Shipyard has so far acquired a 22.5-per cent stake in Great Offshore for Rs305 crore. The additional 20 per cent would cost about Rs560 crore at the current price. ABG Shipyard has made a counter offer to Great Offshore's shareholders. The two offers will open and close simultaneously 14 days after the approval from the regulator.

Bharati, at its annual general meeting in Mumbai on Tuesday, said it had a capital expenditure plan of Rs200 crore for the next two years. It got shareholders' approval to raise fresh funds. The company did not specify the amount it plans to raise. Bharati also expects Rs277-crore of subsidy from the government.

P C Kapoor, MD of Bharati Shipyard, said, "We have clarified SEBI's queries and expect the approval in the next few days time." Bharati had last raised the offer price for Great Offshore to Rs560. This takes the acquisition price for the extra 20 per cent stake it is seeking to Rs438 crore.

Bharati Shipyard, which recently increased its stake in Great Offshore to 22.48 per cent, plans to spend Rs438 crore to acquire another 20 per cent in the company at Rs560 a share, Kapoor said. ABG's last offer was at Rs520, but it could still up the price and increase its holding from the current 8.5 per cent.

"This investment is a significant step towards the company's aspirations of having a strong foothold in all spheres of the offshore industry," Kapoor told shareholders at the annual general meeting.