ABG to Continue Seeking More in Great Offshore

NEW DELHI -- ABG Shipyard Ltd. said Thursday it will continue to seek a controlling stake in Great Offshore Ltd. as a bidding war between two of India's biggest shipbuilders escalates.

ABG, the nation's largest private shipbuilder by sales, has been engulfed in a more than four-month battle with rival Bharati Shipyard Ltd. to take control of Great Offshore, a provider of offshore services to oil and gas producers.

Bharati Wednesday raised its open offer price for Great Offshore to 560 rupees from 405 rupees, which is nearly 8% more than that offered by ABG in July.

ABG and Bharati are vying for a controlling 33.85% stake in Great Offshore that's expected to give the winning bidder key inroads into the offshore services sector, which is growing in both India and overseas.

Also, either company would be able to offer the offshore services under an integrated platform with their current shipbuilding operations.

"We are in the game," ABG's chief financial officer, Dhananjay Datar, told Dow Jones Newswires. "We will do whatever it takes to take control of Great Offshore."

Bharati raised its stake via its unit Dhanashree Properties Pvt. Ltd., which purchased about 1.12 million shares of Great Offshore, comprising 3.01% of outstanding shares at an average price of 558.81 rupees.

"The highest price paid for acquiring some of the shares (of Great Offshore) was 560 rupees. Accordingly, the offer price for the offer shall stand revised to 560 rupees per equity share," Bharati informed the Bombay Stock Exchange.

Bharati now holds a 22.48% stake in Great Offshore, while ABG owns 8.5%.

"Of course, counter offers are something that is a reality until the open offer ends," Mr. Datar said. "We are better equipped," he said, without elaborating.

He said market regulator, the Securities & Exchange Board of India, is expected to shortly ask both ABG and Bharati to launch their open offers simultaneously to buy stakes in Great Offshore.

"We hope most of the issues have been answered (to SEBI)," Mr. Datar said, adding that the company has the resources to raise its stake in Great Offshore.

On May 7, Bharati acquired a 14.89% stake in Great Offshore, which was followed by an open offer to acquire 20% in Great Offshore.

This was followed by a counter offer from ABG Shipyard and multiple upward revisions of the offer prices by both companies.

Shares of Bharati gained as much as 8.3% on news of the revised open offer price. They traded 4.5% higher at 218 rupees in afternoon trading on the Bombay Stock Exchange, compared with the benchmark index, which remained fairly unchanged.

ABG rose 1% to 268 rupees, while Great Offshore traded 0.3% higher at 566.5 rupees.