Shipping Corporation of India (SCI) and Iran Shipping Lines are finding it hard to wrap up their 39-year-old joint venture Irano Hind Shipping Lines due to the differences in the valuation of the company. SCI estimates its 49% stake in the joint venture to be USD 132 million, while Iran Shipping Lines has valued SCI’s stake at USD 95 million, The Economic Times reports.
The sanctions imposed by the US and the EU on Tehran have made the joint venture unprofitable, leading to winding up of the joint venture established in 1975 as a mark of friendship between the two countries.
“The matter is being negotiated between the two companies. If we are unable to reach a resolution, we will approach the external affairs ministry since they would be better placed to get us a good bargain,” a senior official told ET.
India’s Cabinet Committee on Economic Affairs approved winding up of the company last year.
SCI had been advised that one party should keep the assets, while the other party should be paid for its share. The solution was suggested because dissolving the company and then splitting the assets contradicted the laws of Iran.
“We are hoping that some compromise will be reached by the end of this month,” said SCI chairman Arun Kumar Gupta.
Irano Hind Shiiping Lines operates a fleet of six vessels, among them tankers and bulk carriers of 0.66 million DWT.
Two of the vessels have been impounded by China, with only one vessel currently active.
“Irano Hind vessels are mostly arrested with the banks on non-payment of dues and defaults,” Gupta said.