Dredging Corp to tie up with foreign partners

The company has appointed PricewaterhouseCoopers to identify foreign partners for setting up the JVs.

"We might set up two JVs, one each with a Netherlands and Belgium-based entities and we expect the two JVs to be operational by November end," Gunnam Ganapati Rao, director (operations and technical) of DCI, told a press conference here today.

The corporation has lined up Rs 195 crore capital expenditure to acquire two dredgers - one 5,000 cubic metre shallow draught trailer suction hopper dredger in fiscal 2006 (Rs 115 crore) and one 10,000 horse power cutter suction dredger (Rs 80 crore) in fiscal 2007.

These acquisitions will be financed by a combination of internal resources and commercial borrowings, Rao said. DCI has cash reserves of about Rs 280 crore.

"As part of implementing the KPMG recommendations on restructuring, we introduced a second voluntary retirement scheme (VRS) in October 2003 and we expect to retire about five per cent of our shore employees," Rao said.

The company implemented its first VRS during 2000, which was availed by 119 employees comprising 22 per cent of its shore employees.

DCI is entering the capital market on February 26 with an offer for the sale of 56,00,000 equity shares of Rs 10 each. The offer would constitute 20 per cent of the paid-up capital of Rs 28 crore.

"The lead managers will submit their recommendation to the government on the floor price for the issue," Yogesh Kapur, senior vice-president of Enam Financial Consultants, which is one of the book running lead managers to the offer, said.