Garware lines up Rs 250 cr for vessel buyouts

Post-acquisition, Garware will have a fleet size of 10 vessels.

Garware Offshore Services plans to acquire two anchor handling towing-cum-supply vessels (AHTSVs) and one platform supply vessel (PSV) for an estimated cost of Rs 250 crore.

Post-acquisition, the city-based offshore shipping company's will have a fleet size of 10 vessels with six AHTSVs and four PSVs.

"The company is in final stages of negotiations with two Singapore-based shipping yards including Keppel Marine and Pan United for AHTSVs. The contract for building the new PSV is likely to inked with Norway-based Havyard Leirvik AS," industry sources told Business Standard.

When contacted, company officials declined to comment on the issue. Garware Offshore's four ATHSVs and one PSV are used in the oil drilling operations off the coast of India.

The vessels are used to carry personnel and cargo from onshore sites to rigs as well as to tow rigs and buoys from one location to another.

The estimated cost of each AHTSVs is $17 million while the PSV would cost $20 million. The company is expected to take delivery of these three vessels in 2008 and 2009.

Sources said the company would be raising fresh capital either through preferential allotment or issuing foreign currency convertible bonds (FCCBs).

"The company will meet finance requirements through internal accruals, fresh equity infusion and debt. Recently, the company raised over Rs 22 crore through preferential allotment," sources said.

Earlier, the company had secured a PSV contract of Rs 24.50 crore per annum for three years from Transocean Offshore International Ventures.