Bidding intensifies for Reliance Naval

About a dozen investors have reportedly tabled bids for troubled Indian shipbuilder Reliance Naval and Engineering (RNEL), with interest in the company increasing following the Indian government’s stated intention earlier this month to ban imports of naval warships.

RNEL has been up for sale for several months through an expression of interest (EOI) issued on its website. The company – based in Mumbai - is in heavy debt and its creditors are looking for a new owner.

The deadline for EOI submissions was 21 August, with the aim to finalise a list of prospective investors by 10 September and a sole bidder by the end of October.

The most high-profile bidder for RNEL is the Russian state-owned enterprise, the United Shipbuilding Corporation (USC), which is known to have been looking to expand its profile in the Indian naval shipbuilding sector for several years.

According to reports in India, more than 10 other investors have responded to the EOI with bids from companies including Indian firm Chowgule, which operates a shipbuilding division in Goa; Dutch infrastructure group APM Terminals Management, which operates a port near to RNEL’s shipyard in Gujarat on India’s west coast; and trading group Hazel Mercantile Limited, which has offices and facilities across India.

Another series of bids have reportedly been tabled by private equity firms and asset reconstruction firms, which specialise in buying bad loans and assets from financial institutions.