Adani Ports to Acquire 75% Stakes worth 13,527 Cr in Krishnapatnam Port

BY Tiya Chatterji january 4, 2020

Adani Group's port developing arm Adani Ports and Special Economic Zone (APSEZ) on January 3rd said, it will acquire 75 per cent stake in Krishnapatnam Port Company (KPCL) in a cash deal that values the port at Rs 13,500 crore. The acquisition of nearly 75 per cent stake from the existing shareholders of KPCL will accelerate APSEZ's pace towards 400 MMT by 2025, the company said in a statement.

Located at Krishnapatnam in Nellore district of Andhra Pradesh, north of Chennai, the port was developed in 2008 by CVR Group, which continues to own a majority stake. London-based private equity firm 3i Group owns a minority stake. The port adds about 64 million metric tons (MMT) of annual cargo-handling capacity to Adani Ports 'aggregate , increasing its market share by 5 percentage pointing at 27%. With inclusion of the Krishnapatnam, Adani Ports now has 12 ports and terminals across the country.

“This acquisition would accelerate our stride towards FY25 vision of handling 400 million tons (mt) cargo. Given the best-in-class infrastructure and the distinct hinterland catered by Krishnapatnam Port, this acquisition will increase our market share to 27 per cent (from current 22 per cent),” Karan Adani, chief executive officer of APSEZ, was quoted as saying.

The Adani Group, which has become one of the largest port developer and operators in the country, has been on an augmentation spree with its eyes set on achieving 400 MMT cargo handling capacity by 2025. As on March 31, 2019, debt at Krishnapatnam Port stood at Rs 6,000 core. CVR Group-promoted Krishnapatnam Port as a multi-cargo facility, which handled 54 mt in FY19. With this acquisition, the company has strengthened its position on the east coast of India. Adani Ports is operating Ennore and Kattupalli (Tamil Nadu), Vizag (Andhra Pradesh), and Dhamra (Odisha) ports and terminals on the east coast. Making it evident that its capacity enhancement plans over the next few years would also include inorganic growth route.