India’s Mazagon Dock to acquire control of Colombo Dockyard for US $ 52.96mn

India’s Mazagon Dock Shipbuilders Ltd has agreed to buy a controlling stake in Sri Lanka’s Colombo Dockyard PLC for up to US $ 52.96 million, the companies said.
Colombo Dockyard said its board signed an agreement on June 27 with Mazagon Dock and Japan’s Onomichi Dockyard Co. Ltd, the shipyard’s current majority shareholder, under which Mazagon Dock will acquire at least 51 percent of the Sri Lankan yard through a mix of primary and secondary share purchases, making Colombo Dockyard its subsidiary.
The transaction is subject to statutory and regulatory clearances, including approval from the Colombo Stock Exchange.
Mazagon Dock, a state-controlled shipbuilder listed in Mumbai, said in a separate filing that it expects to close the deal within four to six months. 
The acquisition is aimed at unlocking operational synergies, strengthening research and development capabilities and widening market reach across South Asia.
“This acquisition supports the company’s long-term growth vision in the shipbuilding and ship repair industry,” the filing noted.
Colombo Dockyard said it would release further details to the exchange as approvals are secured and transaction milestones are met. 
Colombo Dockyard Chairman Lalith Ganlath in its latest annual report released earlier this month described its last financial year as one of the “most challenging and traumatic years” in the shipbuilder’s history. The company has been navigating severe headwinds, including continued financial losses and the significant exit of its long-term majority shareholder Onomichi Dockyard of Japan. However, he noted that looking forward, the company has a clear strategic trajectory. 
“We will strengthen our presence in high-growth niches such as hybrid technology-propelled vessels and offshore energy support ships,” Ganlath said. 
Plans also include expanding infrastructure at Hambantota and investing in lean management processes to enhance efficiency.