*** Hurray : Pipavav and MDL to form JV as Mazagon Dock Pipavav ***

[angeldemon_007]

Pipavav Defence and Offshore Engineering Company jumped 10.34% to Rs. 90.20 at 14:20 IST on BSE after the company said it was selected by the India's Defence Ministry as its joint venture partner for building warships for the Indian Navy.

The announcement was made during trading hours today, 12 September 2011.
Meanwhile, the BSE Sensex was down 325.30 points, or 1.93%, to 16,541.67.
On BSE, 1.45 crore shares were traded in the counter compared with average volume of 25.75 lakh shares over the past two weeks.

The stock hit a high of Rs. 90.75 and a low of Rs. 81.25 so far during the day
.
Pipavav Defence and Offshore Engineering Company, earlier known as Pipavav Shipyard, said it would form a joint venture company with Mazagon Dock, a company controlled by the Ministry of Defence, for building warships for the Indian Navy. The joint venture will be named as Mazagon Dock Pipavav.

The company said this is the first time post independence that a private sector company has been selected by the Ministry of Defence to build warships together. The company said the joint venture will be a game changer and it will help the company scale new heights.

Pipavav Defence's board recently approved issuing convertible warrants to a clutch of investors at Rs. 78 each. The firm intends to issue 1.05 crore warrants to three individual investors. Influential investor Rakesh Jhunjhunwala and his wife Rekha Jhunjhunwala will pick up 50 lakh warrants each, according to the statement issued by Pipavav Defence. Another investor, Utpal Sheth, will pick up 5 lakh warrants.

The company will also issue 1 crore warrants to promoter entity Grevek Investments and Finance at Rs. 78 each. Each warrant is convertible into one equity share within 18 months of allotment. Proceeds from the issue would be used for expanding Pipavav's presence in the defence segment and for general corporate purposes.

Pipavav Defence & Offshore Engineering Company reported net profit of Rs. 7.94 crore in Q1 June 2011 as against net loss of Rs. 9.79 crore in Q1 June 2010. Sales rose 92.04% to Rs. 338.03 crore in Q1 June 2011 over Q1 June 2010.

Pipavav Defence and Offshore Engineering Company operates the largest shipyard in India, covering over 200 hectares with approximately 720 metres of sea front and 685 metres of outfit quay. The company recently received license to build warships for the Indian Navy.

Pipavav Defence spurts on nod to build warships

 

[blackops]

Nice development we need more pvt industries in our defence

 

[Raje amar]

its the game changer in history of Indian defence.
if the MOD couldnt give the projects to the privet sector & the PSU's are overloded, its the best possible move.
soon expect HAL, BEL and other PSU's follow the same rout.
good news for the privet sector, if they are willing to share the JV.

 

[jha]

Lets hope this does not screw up the work culture of Pipavav..

 

[angeldemon_007]

^^^
What i understand is the Pipavav shipyard (i am talking about the yards not the company) will just operate the way it operates but the income will be shared by both government and the company and so will the investment.

Lets face it although Pipavav has developed a great infrastructure but its on dept and unless it gets some project in 3-4 years it might even get closed. I think MOD might purchase some shares of Pipavav instead of developing a whole new company.

Now what is Pipavav gaining from this ?
They will be able to generate money by selling their shares to MOD and with that money they can set proposed facilities for land based systems and other defence equipment.
Also considering they were not getting any projects but now Pipavav will act as second MDL and it will be eligible for all projects like Project 17A frigates and Project 15b destroyers and most importantly Project 75I.

It will be like right now MDL is fully packed and for the future projects Mazagon Dock Pipavav will compete rather than MDL for the projects where MDL can't spare space.

In short we are adding a state of the art new shipyards which will be fully utilized from mow unlike the other private shipyards.

---------- Post added at 04:36 PM ---------- Previous post was at 04:35 PM ----------

I think right now MOD can form JV with each private sector shipyard by purchasing their shares especially because their shares cost less.

 

[jha]

^^^
What i understand is the Pipavav shipyard (i am talking about the yards not the company) will just operate the way it operates but the income will be shared by both government and the company and so will the investment.

Lets face it although Pipavav has developed a great infrastructure but its on dept and unless it gets some project in 3-4 years it might even get closed. I think MOD might purchase some shares of Pipavav instead of developing a whole new company.

Now what is Pipavav gaining from this ?
They will be able to generate money by selling their shares to MOD and with that money they can set proposed facilities for land based systems and other defence equipment.
Also considering they were not getting any projects but now Pipavav will act as second MDL and it will be eligible for all projects like Project 17A frigates and Project 15b destroyers and most importantly Project 75I.

It will be like right now MDL is fully packed and for the future projects Mazagon Dock Pipavav will compete rather than MDL for the projects where MDL can't spare space.

In short we are adding a state of the art new shipyards which will be fully utilized from mow unlike the other private shipyards.

---------- Post added at 04:36 PM ---------- Previous post was at 04:35 PM ----------

I think right now MOD can form JV with each private sector shipyard by purchasing their shares especially because their shares cost less.

Lets hope for the best..I have a feeling that this JV is to keep LPDs and P-75I in the hands of MDL...Both of these will be cleared before the end of 2013..

 

[angeldemon_007]

Pipavav, Mazagaon Dock to set up JV to build warships for Navy

MUMBAI (PTI): India’s private sector ship-building firm Pipavav Defence and Offshore Engineering Company (formerly Pipavav Shipyard) on Monday said it will form a joint venture company with state-run Mazagaon Dock (MDL) for building warships for the Indian Navy.

“The Board unanimously approved setting up of the joint venture company with MDL to be named as ‘Mazagon Dock Pipavav Ltd’,” the company said.

The PSU has selected Pipavav as the joint venture partner for building warships for the Navy.

It is for the first time post independence that a private sector company has been selected by Defence Ministry-controlled PSU to build warships together, the company said.

“The Board has recognised this as the 'Golden Day' in the corporate history of the company so far as the proposed partnership is concerned... Board further recognised that this will be a game changer and will help the company to scale new heights,” the firm said.

Pipavav has been on expansion spree following government clearance in March for building warships, submarines among others for the Navy. Recently, it had got orders worth Rs 2,975 crore to design and construct five offshore petrol vessels (OPVs) from the Navy.

The company has also roped in foreign partners like US-based Northrop Grumman and UK-based Babcock Group to increase its presence in defence segment.

In December, the company had signed a protocol with Russian government arm Rosoboronexport for defence co-operation with foreign governments.

According to the company, it is the only shipyard in the private sector with modular construction facilities and a huge dry dock to receive the government licence.

Pipavav, Mazagaon Dock to set up JV to build warships for Navy - Brahmand.com

 

[Black Widow]

Lets hope this does not screw up the work culture of Pipavav..

Smartness is infectious, Smartness of Pipavav will change work culture of MDL...

 

[angeldemon_007]

Lets hope for the best..I have a feeling that this JV is to keep LPDs and P-75I in the hands of MDL...Both of these will be cleared before the end of 2013..

I think this step is the result of incredible delays and cost over-runs. As far as 4 LPD project is concerned 2 of them are going to a private shipyard and 2 to HSL Vizag. Its now most probably to be Pipavav.

Considering project 75I i think we should give this project to LnT. MOD earlier promised LnT this second line of submarine but now they have changed their decision. Because of this promise LnT spend a huge amount of money on shipyard on which they won't be able to get a return unless they get a project big enough to solve their problems other wise we will actually bankrupt this shipyard.

 

[hawx]

akaik pipavav port is owned by maersk sealand company !
That company is associated with US Defence right ?

 

[angeldemon_007]

^^^
Who cares about the port ?

 

[Bombay Dude]

akaik pipavav port is owned by maersk sealand company !
That company is associated with US Defence right ?

The Company, then a wholly owned subsidiary of SKIL, was incorporated as Pipavav Ship Dismantling and Engineering Limited on October 17, 1997 under the Companies Act.

In April 2005, IL&FS, one of the leading infrastructure finance companies in India, became a shareholder, and the name of the Company was changed to Pipavav Shipyard Limited. Government of India controlled banking institutions EXIM Bank and IDBI also took stakes in PSL as well as mutual fund UTI.

In 2007, several other major financial players became shareholders in the form of foreign equity investors.

The Port's Parent Company is Headquartered in Mumbai.

Also MDL is from Mumbai.

Hope for a Good Cordination!

 

[vikrams]

Pipavav Stakeholders


Promoter
SKIL Infrastructure Ltd. (SKIL)

Foreign Companies

Sembcorp Marine Ltd

Financial Institutions and Banks

Infrastructure Leasing & Finance Services Ltd. (IL&FS)
LIC and LIC sponsored Mutual Funds (LIC)
Export Import Bank of India (EXIM Bank)
IDBI Bank Ltd. (IDBI)
Sundaram BNP Paribas Mutual Fund

Foreign Institutional Investors

Smallcap World Fund, Inc.
New York Life Investment Management India Fund (FVCI), II LLC, Mauritius
American Funds Insurance Series Global Small capitalisation Fund
Commonwealth Equity Fund Limited
The California Public Employees' Retirement System (CalPERS)
Batterymarch Financial Management Inc.
The India Fund, Inc. (Blackstone Group)





Maybe the new company will be a 50 - 50 govt -pvt venture.

 

[Kinetic]

Excellent decision. Hope this will bring better working culture. MDL makes hitech warships but all of them are delayed or take long time. Modern warship building needs very complex job. Pipavav will learn this from MDL while MDL will augment modern infrastructure from Pipavav.

 

[SpArK]

Lets hope it induces some professionalism.Great news!!!!!1