Major ports may lend Rs. 300-cr to bail out DCIL

Funds are also required for payment towards the first in the series two with a proposal being built at an estimated cost of Rs 1,000 crore by CSL as part of Atmanirbhar Bharat initiative. CSL will construct the Beagle class dredger with 12,000-cubic-metre capacity

Visakhapatnam: Efforts are on to pump in around Rs 300 crore by four major ports to bail out cash-starved Dredging Corporation of India Limited (DCIL), a Visakhapatnam-headquartered listed company.

A consortium comprising Visakhapatnam Port Authority (VPA), Paradip Port Authority (PPA), Jawaharlal Nehru Port Authority (JNPA erstwhile JNPT) and Deen Dayal Port Authority (Kandla) took over strategic control of the company by acquiring Government of India's 73.47 per cent shareholding in 2019 on payment of Rs.1056 crore after the Ministry of Shipping dropped a plan to privatise it as part of strategic disinvestment. Among the four ports, VPA holds slightly higher equity.

"We are also probing into the wrong decisions taken during the stint of Managing Director and CEO GYV. Victor, who was placed under suspension recently for allegedly submitting fake documents by suppressing facts at the time of selection for the post," VPA Chairman K Rama Mohana Rao told Bizz Buzz on Tuesday.

Rao, who is also the Chairman of DCIL, said a chargesheet will be framed against him in a few days after which an enquiry officer will be appointed.

Stating that the financial position of DCIL has become precarious as it is unable to settle its regular commitments, he said the company owed a lot of amount to Dutch dredging firm and excavation contractor Van Cord Private Ltd, which was subcontracted for a work at JNPT bagged by DCIL. The Dutch firm has moved the National Company Law Tribunal (NCLT) for settlement of an outstanding amount of Rs.93.12 crore. The aggrieved party has sought to initiate the settlement process as per Section 8 and 9 of Insolvency and Bankruptcy Act.

Rao said as an emergency help, VPA and PPA had agreed in-principle to lend an amount of Rs 50 crore. JNPT and Kandla Port are also being requested to arrange Rs 100 crore each. The amount is being given on payment of interest as applicable.

Industry sources said DCIL is facing the heat as it is paying huge amounts from its contracted value on fuel cost. During the pandemic the fuel cost has gone up abnormally.

Funds are also required for payment towards the first in the series two with a proposal being built at an estimated cost of Rs 1,000 crore by Cochin Shipyard Limited (CSL) as part of Atmanirbhar Bharat initiative. CSL will construct the Beagle class dredger with 12,000-cubic-metre capacity for which part of the fund needed is met through bank borrowing. After part of the fund required was pledged by CSL as loan, DCIL still needs to mobilise some amount.