Rolta sells 50% JV stake to Shaw

Rolta today announced that it has sold its 50 per cent share in Shaw Rolta Limited (SWRL) to its joint venture partner,Stone & Webster,Inc - a subsidiary of The Shaw Group,Inc.

Rolta today announced that it has sold its 50 per cent share in Shaw Rolta Limited (SWRL) to its joint venture partner,Stone & Webster,Inc – a subsidiary of The Shaw Group,Inc.

The transaction is effective from December 31,2010. “Rolta has been able to unlock substantial value in SWRL to its best advantage. For its 50 per cent shares that have a face value of approximately USD 100,000 (Rs 50 lakh),the sale agreement provides for an immediate receipt by Rolta of a sum of USD 27.5 Million (about Rs 125 crore),and in addition,about USD 8.0 million (Rs 36 crore) over the next two years,for defined services,aggregating to about USD 35.5 million (nearly Rs 160 crore) as total consideration per the agreement,a company statement said here.

SWRL paid a dividend of Rs 1 crore each to Rolta and Shaw for the last financial year ending on June 30,2010.

Story continues below this ad

“This is a win-win situation for both partners. After a very satisfactory performance by the JV,this transaction enables both Rolta and Shaw to pursue their business strategies independently and still provides Rolta the right to leverage The Shaw Group’s expertise and track record in nuclear power over the next five years,as and when Shaw desires to serve the Indian nuclear energy market,” Rolta’s Chairman & Managing Director,K.K. Singh said.

SWRL was established as a 50:50 joint venture in 2004 to serve as an off-shore engineering center for Shaw’s global projects,and to focus on EPCm business in India,including the nuclear energy sector.

Rolta is completely committed to and continues to strongly participate in India’s growth story and its emerging nuclear power market. To resolve certain exclusivity provisions in SWRL’s charter and to empower each partner to follow their respective business strategies,Rolta and Shaw have agreed to place ownership of 100 per cent of SWRL with The Shaw Group.

In addition,The Shaw Group has agreed that in the event Shaw decides to pursue nuclear power projects in India,they will address any such opportunity first with Rolta and Rolta will also have the right of first refusal.

Story continues below this ad

Rolta is already working with various Indian government organisations like NPCIL and other leading agencies on sophisticated projects in the nuclear power sector,such as the prestigious engineering design project for a significant nuclear reactor system of international importance involving a high level of specialised expertise in conceptual design,system development,finite element analysis,and safety analysis,besides multi-disciplinary engineering competence and domain expertise.

Rolta is also in advanced stages of finalising partnerships with world-leading companies to further strengthen its position in the design and engineering market.