Shipping Corp of India (SCI) has submitted plans to spin off its non-core inland and coastal shipping business as the Indian government seeks to sell its investment in the company.
SCI submitted a demerger plan to the Bombay Stock Exchange on Wednesday and is waiting regulatory approvals.
SCI's international shipping activities will survive the demerger.
Spinning off the non-core business will provide "independence to the [SCI] management in decisions regarding the use of their respective cash flows for dividends, capital expenditure or other reinvestment in their respective businesses", the shipowner said.
Shares in the spin-off company will be issued to SCI's shareholders as consideration for the demerger.
The spin-off company will seek to list its securities on the Bombay Stock Exchange and the National Stock Exchange of India.
A bidding process for the government's 63.75% stake in SCI is underway, with five known bidders so far.
In June, SCI's privatisation attracted controversy due to a legal fight between the state shipowner and US-based bidder Safesea Group, which arrested an SCI bulker in South Africa.
Also bidding for the government's controlling stake in SCI are India's Megha Engineering & Infrastructure and a consortium made up of Ravi Mehrotra's Foresight Group, Belgian shipowner Exmar and cash buyer GMS.
SCI owns a diverse fleet of over 130 vessels, including bulkers; crude and product tankers, boxships, LPG and ammonia carriers and offshore supply vessels.
Quarterly result
Meanwhile, the Mumbai-listed company has reported a profitable second quarter for 2021.
SCI recorded net profit of INR 1.46bn ($19.7m) for the second quarter, less than half of the INR 3.2bn it booked for the same period last year.
