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The bidding war for Great Offshore ratcheted up a notch with ABG Shipyard saying it would come out with a counter-offer to rival Bharati Shipyard's offer of Rs 560 a share announced on Wednesday after it acquired 3.1 per cent from the open market to take its total holding to 22.4 per cent.
"We are definitely in the race to buy a controlling stake," said Dhananjay Datar, chief financial officer of ABG Shipyard. "The price and date of the counter offer will be decided later," he added.
Great Offshore is the target of a bidding war in which India's two largest private ship builders are trying to take control. On August 5, ABG Shipyard, the largest private sector shipbuilder, raised the open offer price for Great Offshore to Rs 520 from Rs 450 announced earlier.
This was the second increase in the open offer price by ABG in a week, even as it continued to buy shares from the open market to outbid its rival. ABG Shipyard's holding in Great Offshore reached 8.28 per cent.
Bharati Shipyard responded after over a month by increasing its stake for the second time on Wednesday. Earlier, the company had revised its offer price from Rs 344 to Rs 405 a share.
Bharati acquired 14.89 per cent in Great Offshore in May, at a price of Rs 315 per share, from the latter's vice chairman and managing director, Vijay Sheth, by invoking shares he had pledged against a loan. This left Sheth with less than one per cent in the company and he lost control. According to the analysts, Bharati's primary interest in acquiring the stake was to save its order book.
Bharati is currently at an advantage because it is closer to the 26 per cent stake that would give it veto power to block any board resolution. Counterbids from the rival companies continue as they await the mandatory approval for their respective open offers.
Bharati Shipyard's open offer was supposed to run from July 25 to August 13. But the company is yet to get approval from the Securities and Exchange Board of India. ABG Shipyard's open offer was to run from August 13 to September 1. It is also waiting for approval from the market regulator.
Great Offshore stock gained 0.3 per cent to Rs 566.7 a share on the Bombay Stock Exchange on Thursday. ABG Shipyard gained 0.3 per cent to Rs 266.1 and Bharati Shipyard gained 2.64 per cent to Rs 214 a share.