Adani Ports and Special Economic Zone (APSEZ) on Thursday said it has signed a share purchase agreement to acquire 97% stake in Marine Infrastructure Developer (MIPDL) for an enterprise value of Rs 1,950 crore, paving the way to officially take over the ownership of Kattupalli Port near Chennai from L&T Shipbuilding.
The company said it now expects to close the transaction, announced two years ago, in one week’s time, having obtained all the necessary approvals. While awaiting the necessary approvals, APSEZ through its subsidiary Adani Kattupalli Port (AKPPL) had entered into an arrangement to take over the operations of the port.
Announcing the completion of the transaction, APSEZ said it has inked a share purchase agreement with Larsen and Toubro, Marine Infrastructure Developer, L&T Shipbuilding and AKPPL, to acquire 97% stake of Marine Infrastructure Developer, which runs the Kattupalli Port.
APSEZ CEO Karan Adani said, “We are thankful to the Tamil Nadu government and ministry of commerce for giving approvals in record time. Adani Ports is committed to making Katupalli Port one of the largest ports in southern India. We are going to start our construction to diversify the cargo of the port and will be adding 40 MMT of new capacity in the next three years. We are confident that with our superior infrastructure and efficient handling of cargo we will be able to reduce logistics cost of industries in the region and be one of the engines of growth.” APSEZ had signed an in-principle agreement for acquisition of Kattupalli Port from L&T Shipbuilding (L&TSB), a subsidiary of Larsen and Toubro, in November 2015.
It said the Tamil Nadu government had granted approval for the proposed transaction in February 2016, since TIDCO, a state government entity, held a minority stake. Subsequently, other relevant approval of the ministry of environment and forest, Tamil Nadu Industrial Development Corp, Tamil Nadu Maritime Board and SEZ authorities have also been obtained.
As per the all-cash deal, APSEZ will pay `388 crore to L&T and its units, while settling liabilities of another Rs 1,562 crore. MIPDL, incorporated in 2016 to operate Kattupalli Port, had a revenue of Rs 99 crore for FY17 and no revenue for FY18.
APSEZ said it will develop the container terminal further and provide bulk terminal, marine and container services at the location. “The acquisition will enable the company to develop container terminal operation to increase market share and provide container, bulk terminal operation and marine services,” APSEZ said. The port is one of India’s most modern, emerging as Chennai’s new gateway for EXIM trade in the Chennai/Bengaluru region.
Amongst the many advantages of Kattupalli port is its location, 30 km north of Chennai with connectivity to the hinterland of north Tamil Nadu, Chennai, Bengaluru region and south Andhra Pradesh.
