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| Great Eastern plans listing of its offshore subsidiary |
| BS Reporter / Mumbai Mar 23, 2010, 00:53 IST |
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Great Eastern Shipping, India’s largest private sector shipping company, said it had taken board approval to bring an initial public offer for its subsidiary, Great Ship. The company is planning the IPO to raise finances for the expansion of its subsidiary that is currently operating two rigs and 14 offshore supply vessels. The offshore service provider is expecting delivery of eight more such vessels in the near future.
“It is the first step in the direction of listing the subsidiary,” said Ravi K Sheth, managing director of Great Ship. “Rest will be finalised in due course,” he said. He did not divulge the amount the company would like to raise through the IPO.
The company may file the draft red hearing prospectus with the regulator Securities and Exchanges Board of India (Sebi) in a month’s time said market sources.
Great Eastern Shipping had initially built its offshore business under Great Offshore. But that company was de-merged in 2005 to meet a family settlement. The company went under the management of Vijay K Sheth, cousin of Ravi K Sheth. Great Eastern then developed its offshore business under Great Ship. But last year Vijay Sheth lost his control over Great Offshore due to pledging of shares and that is now controlled by Bharti Shipyard.
“Shipping is a cyclical business so developing subsidiary of an offshore business provides sort of balance for these companies,” said analyst with domestic brokerage who did not wish to be quoted. “An IPO will help in speedy expansion of the subsidiary at a time when offshore business is likely to pick up,” he said. Stock of the GE Shipping was down by 2.18 per cent to Rs 282.9 on Monday. The company had made the announcement post the trading hours. Sensex the benchmark index of the exchange was down by 1 per cent to 1,7410 on the day.
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