Reliance Defence in talks with Coast Guard for patrol vessels

NEW DELHI: Anil Ambani-led Reliance Defence and Engineering is in talks with the Indian Coast Guard to finalise a long-pending Rs 920-crore contract for 14 Fast Patrol Vessels.

The erstwhile Pipavav Shipyard, which has been taken over by the Reliance group and renamed as Reliance Defence and Engineering (RDEL), had emerged as the lowest bidder for the project, beating Goa Shipyard and L&T.

Contract with the Coast Guard is likely to be signed in October, defence sources said. They said the design will be done in-house and built by RDEL at its Pipavav shipyard.

The vessels are designed primarily to keep a tab on anti-smuggling and anti-terrorist operations and for fisheries protection and search and rescue.

A few weeks ago, the defence ministry cleared RDEL for defence projects after a financial and technical capability of the company's shipyard was carried out in detail.

This makes RDEL eligible for participation in the naval defence contracts.

In March 2015, Reliance Infrastructure together with its wholly-owned subsidiary Reliance Defence Systems Private, had agreed to acquire from promoters of Pipavav Defence approximately 18 per cent in the company at Rs 63 per share, aggregating Rs 819 crore.

This was followed by an open offer. Post open offer, Reliance Infra now owns almost 35 per cent in the company.

Later on, Pipavav Defence also announced its plans to exit the corporate debt restructuring (CDR) package as it would lead to improved financial flexibility and increased business opportunities.