Bharati Defence hits 5% upper circuit limit on reports of potential buyers

NEW DELHI: Shares of Bharati Defence were locked at 5 per cent upper circuit limit in Monday's trade on reports that Mahindra Defence and Shapoorji Pallonji Group may independently bid for the troubled company in the first such bankruptcy resolution attempt under the Insolvency and Bankruptcy Code for the security industry.

The two companies are currently evaluating the deal that values the target company at $350 million, said three people with direct knowledge of the development told ET.

Following the report, the scrip rose 4.89 per cent to Rs 7.30 on BSE.

According to the report, Bharati has also seen interest from other suitors such as German Dry Docks and other companies seeking to control individual docks along India’s eastern and western water margins.

“Mahindra Defence and Shapoorji Pallonji group have been approached and they are currently carrying out due diligence on the company," said one of the persons with direct knowledge of the development. EY is acting as advisor to the lenders, ET reported.