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A first-generation businessman and chairman of Pipavav Defence, Nikhil Gandhi set up India's first Special Economic Zone and sold it to Mukesh Ambani. The’s now sold India's first private shipyard to Anil Ambani’s Reliance Infrastructure. A talk with Dev Chatterjee:
There were many suitors for the company, including M&M and Munjals. What made you sell the company to the Anil Ambani group?We needed a partner committed to the defence business. This sector will turn out to be one of the biggest opportunities for Indian companies. The government under Narendra Modi is keen that Indian companies bag defence orders and instead of importing, we should be exporting defence equipment.
The Anil Ambani group is vibrant and ready for a partnership with us. They recognised the value of our assets, opportunity in the sector and the government’s policy very well and in time. Together, we can make Pipavav a multinational corporation in the defence sector.
The group will now control the company. What will be your role?
We will continue to remain on the board of Pipavav as non-executive directors and Ambani will take over as chairman. We will remain minority shareholders for at least the next five years.
What happens to the company’s corporate debt restructuring (CDR)?
It remains on track and we are working with the banks to bring our debt under control. The CDR process was irrespective of the stake sale.
Will the name be changed? What next for the company?
Yes, the name will be changed to Reliance Defence. Beside naval defence, the company will focus on naval aviation and manufacturing of armaments & ammunition, for which we have secured a production licence. We expect to generate economic activities for almost 60,000 people in the near future. The Indian defence sector will provide orders worth $250 billion in the next five years and Pipavav Defence is at the right place to make the best of the opportunity.
