In a day of high drama, Bharati Shipyard countered ABGs offer with a Rs 403 per share offer. Bharati also raised its stake in Great Offshore by buying another 4.58% from the Sheth family, taking its total stake to 19.47%. With this and the open offer, Bharatis stake in Great Offshore should go up to around 40%. ABG, meanwhile, indicated it will revise its offer, but no announcement came in till late Tuesday evening.
ABG said it along with Eleventh Land Developers offered to buy 1,25,71,072 shares, or 32.12% stake in Great Offshore. The counter-offer will open on August 13 and close on September 1. ABG plans to fund the offer through internal accruals. Bharatis open offer will begin on July 25 and close on August 13.
Meanwhile, Videocon group chairman Venugopal Dhoot, who holds around 3% stake in Great Offshore, said the fair price for Great Offshore is Rs 600 a share, and bids may touch that level driven by likely higher bids.
Rs 375 a share (offered by ABG Shipyard in its counter-offer) is too low. The right price for Great Offshore is Rs 600 rupees (a share). The enterprise value of the company is Rs 2,500 crore, based on five times the Ebitda, Dhoot was quoted by a news agency. He, however, said Videocon will not sell its stake in Great Offshore for the next two years.
Both ABG, Indias biggest private yard, and Bharati, the second-biggest, want to buy Great Offshore as demand increases for drill ships and other offshore structures.
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The world is entering an era of slower growth that will require tighter and more effective oversight of the financial system, warns a new World Bank report issued on Monday, even as it expects the Indian growth rate to swing back to 8% in 2010. The report, The Global Development Finance 2009: Charting a Global Recovery has estimated that global growth will be worse than seen its earlier report of April. While the April report had projected a contraction of 1.3% in global GDP, the Bank now expects a 2.9% contraction in 2009.
Uttarakhand health minister Ramesh Pokhriyal Nishank replaced B C Khanduri as the new chief minister of the state. This was decided at the state legislative party meeting held at the party headquarters in the Capital where legislators were asked to write their preferred candidates name on a piece of paper; Venkaiah Naidu and Thevarchand Gehlot were the central observers.
Within a fortnight of finance minister Pranab Mukherji meeting with leading bankers and urging them to cut rates to stir up the demand for credit and thereby the economic activity, State Bank of India has revised the benchmark prime lending rate by 50 bps to 11.75% from 12.25%, effective from June 29, 2009.
Federal Reserve officials will probably seek on June 24 to reassure investors they can keep short-term interest rates at a record low without igniting inflation. The Feds Open Market Committee may stress that increasing slack in the economy will contain consumer prices into next year, analysts said. Policy makers also will likely discuss how to avoid a jump in longer-term Treasury yields once they fulfill their commitment to buy $300 billion in Treasuries as soon as August.