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Tuesday November 19, 2019

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Reliance Acquires Pipavav Defence & Offshore

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RELIANCE INFRASTRUCTURE ACQUIRES PIPAVAV DEFENCE AND OFFSHORE ENGINEERING COMPANY LTD.

LARGEST EVER ACQUISITION IN DEFENCE SECTOR IN INDIA

LEADERSHIP IN DEFENCE SECTOR WITH GLOBAL SCALE INFRASTUCTURE CAPABLE OF BUILDING SUBMARINES, AIRCRAFT CARRIERS AND WARSHIPS, APART FROM LNG CARRIERS, OFF SHORE PLATFORMS AND RIGS

TECHNOLOGICAL TIE-UPS WITH GLOBAL DEFENCE LEADERS INCLUDING:
• SAAB OF SWEDEN
• DCNS OF FRANCE
• SEMBCORP MARINE OF SINGAPORE
• JSC ZVYOZDOCHKA OF RUSSIA
• ROSOBORON EXPORT OF RUSSIA

UNIQUELY PLACED TO TAP GROWTH OPPORTUNITIES IN DEFENCE UNDER HON. PRIME MINISTER NARENDRA MODI’S MAKE IN INDIA PROGRAMME

POTENTIAL ORDERS OF RS. 1,20,000 CRORE (US$ 20 BILLION) OVER THE NEXT UPTO 5 YEARS

ACQUISITION OF APPROX. 18% STAKE FROM PROMOTERS OF PIPAVAV FOR RS. 819 CRORE AT RS. 63 PER SHARE ACCOMPANIED BY OPEN OFFER FOR 26% OF SHARE CAPITAL AT RS. 66 PER SHARE

BOARD RECONSTITUTION UPON COMPLETION OF OPEN OFFER FOUNDER PROMOTERS TO CONTINUE WITH MINORITY STAKE AND 2 NON-EXECUTIVE BOARD SEATS

POST COMPLETION MR. ANIL D. AMBANI TO BE CHAIRMAN OF BOARD

Mumbai, March 4, 2015: Reliance Infrastructure Limited today announced the acquisition of Pipavav Defence and Offshore Engineering Company Limited, together with sole management control.

Reliance Infrastructure, together with its wholly owned subsidiary Reliance Defence Systems Private Limited, has agreed to acquire from the Promoters of Pipavav Defence 13,00,00,000 equity shares representing approx. 18% shareholding in the Company at a price of Rs. 63 per Share, aggregating Rs. 819 crore.

Pursuant to the aforesaid acquisition resulting in a change in management and control of the Company, Reliance Defence Systems Ltd., a subsidiary of Reliance Infrastructure Ltd. has issued a Public Announcement to make a mandatory open offer to acquire 26% shares from the public shareholders of the Company, at a price of Rs. 66 per share, in terms of applicable SEBI Takeover Regulations.

As per the agreement with the Promoters, Reliance will also acquire from them such number of additional equity shares of the Company, at the same price of Rs. 63 per share, as is required to ensure that Reliance’s shareholding is not less than 25.10% of the Target Company, after taking into account the acquisitions made under the Open Offer.

Post the transaction, the existing promoters of Pipavav Defence will continue to retain a minority stake in the Company, together with two non-executive Board seats.

The transaction is subject to certain conditions precedent and various statutory approvals, etc.

Post completion of the transaction, Mr. Anil D. Ambani, Chairman, Reliance Group, will become Chairman of the Company.

Commenting on the transaction, Mr. Ambani said “This is a unique opportunity for Reliance Group to participate in Prime Minister Mr. Narendra Modi’s “Make in India” programme for the high growth defence sector.”

Mr. Ambani added, “We are confident that our strategic investment will create long term value for all stakeholders.”

Mr. Nikhil Gandhi, the founder promoter and Chairman of Pipavav Defence and SKIL, stated, “This transaction is an endorsement of the vision we set out to achieve almost 10 years ago. Aside from the commonality of vision, we share a philosophy of long-term value creation for all stakeholders. I look forward to supporting Reliance to realize the goal of creating India’s foremost defence company, with an emphasis on the 'Make in India' programme initiated by the Hon'ble Prime Minister of India.”

Mr. Bhavesh Gandhi, co-promoter and Vice Chairman of Pipavav Defence stated, “I expect Reliance’s strategic investment to accelerate our progress towards meeting the needs of our Nation, and creating sustainable social value in the community we operate in.”

JM Financial Institutional Securities Limited is the sole financial advisor and the Manager to the Open Offer.

Source:
Rajesh K Dhingra
President
Reliance Defence & Aerospace Pvt Ltd

 


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