New Delhi: In a move aimed at possibility of buying the Gujarat-based Pipavav Shipyard of Anil Ambani Group’s Reliance Naval and Engineering Limited (R-Naval) by industrialist Navin Jindal’s Jindal Steel and Power Limited and Russian government-owned United Shipbuilding Corporation carried out an inspection of the shipyard.
The Jindals completed inspection of the naval shipyard during the last week of February, while a five-member team of the Russian government concluded its inspection on March 2, media reports quoting sources said.
R-Naval is undergoing process of the Insolvency and Bankruptcy Code (IBC) and facing claims of over Rs 43,587 crore from several financial creditors, including the State Bank of India (Rs 1,965 crore), the Union Bank of India (Rs 1,556 crore) and the IDBI Bank (Rs 1,375 crore).
According to sources, the National Company Law Tribunal (NCLT), Ahmedabad, in its order dated February 24, has granted an extension of 153 days (September 1, 2020 to January 31, 2021), owing to the Covid-19 pandemic, for the completion of the Resolution Process of R-Naval by August 2021.
In addition, the Resolution Process of R-Naval has extended the bids submission date for the fifth time, to March 15, 2021.
The extension of the insolvency process for Pipavav comes at the same time when a new bidder has entered the fray — Jindal Steel and Power Limited, India’s third-largest producer of the alloy by market value.
All potential bidders want assurances from the Defence Ministry and the Indian Navy, besides the Coast Guard, that orders will be given to the new buyer in order to pay for their risk and investment.
It is learnt that the government is unwilling to give any such assurance to any bidder, including the Russian government, saying the yard would have to follow established rules to competitively bid for the potential shipbuilding orders.