Lenders Hire Rothschild to Sell ABG Shipyard
Largest Private Sector Shipbuilding Yard in India ABG Shipyard is for sale. The Lenders led by State Bank of India has hired investment bank Rothschild to find a buyer for a majority stake in the company as they struggle to save Rs 16,000 crore ($2.4 billion) worth of loans given to it, reports Economoc Times.
Lenders have to complete this exercise -converting debt into equity -within 210 days and find a new buyer within 18 months, according to Reserve Bank of India norms.
Earlier, Global commodities platform SIMEC Group bought a 51% stake in ABG Cement for Rs525 crore and initiated a management change in the company earlier this financial year.
Meanwhile, Lenders to ABG Shipyard have converted a significant portion of their debt into equity and now own 49.15% in the company.
However, at a recent AGM the shareholders of debt-laden ABG Shipyard rejected its lenders' proposal to invoke strategic debt restructuring (SDR) in the company.
ABG Shipyard's CDR was approved in March 2014. The company has been struggling to have resolve the debt issue but has not been able to make much progress with business climate remaining grim leading to drying topline.
In June 2015, ABG Shipyard had stated that Beirut-based Prinvest Holding SAL had expressed firm interest in buying majority stake in the shipyard, however, that deal did not materialize.
