Swan Energy nods amalgamation of subsidiary with Reliance Naval

25 Nov 2024 , 12:02 PM

Swan Energy’s shares rose 6% to a day high of ₹620.25 on the BSE after the firm stated on Friday that it has accepted the plan of arrangement and merger between its fully owned subsidiary Triumph Offshore (TOPL) and Reliance Naval and Engineering (RNEL).

The amalgamation procedure requires no financial payment, and the consideration will be fulfilled by RNEL’s issuance of redeemable preference shares.

The business further stated that RNEL has sustained significant losses in recent years and has undertaken a corporate bankruptcy resolution procedure, which has significantly reduced its balance sheet leverage.

The arrangement now allows RNEL to investigate potential for shareholder benefit, such as dividend payments.

Swan Energy also stated that the proposed merger will assist the group in consolidating all activities such as the purchase, sale, charter hire, construction, repairs, and so on of ships, boats, vessels, other modes of transportation, and conveyances into a single entity, allowing the combined business to capitalize on the complementary capabilities of both companies.

At around 10.59 AM, Swan Energy was trading 4.07% higher at ₹610.70, against the previous close of ₹586.80 on NSE.

The company said that the amalgamated business would also have control over the entire value chain, from vessel design and building to finance, leasing, and eventual management. This integration will provide the organization better control over prices, quality, and delivery dates, resulting in more efficient operations.

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