Adani Ports and Special Economic Zone Limited (APSEZ), India’s largest port developer, operator and the logistics arm of the Adani Group, will be acquiring a controlling stake of 75% from the existing shareholders of Krishnapatnam Port Company (KPCL).
KPCL is located in the southern part of Andhra Pradesh, the state with the second largest coastline of in India, and is a multi-cargo facility which handled 54 MMT in FY19.
This acquisition will accelerate APSEZ’s stride towards 400 MMT by 2025, according to Adani.
Acquisition value of KPCL is approximately 135 million Rupee ($1.9 million). The purchase consideration will be funded through internal accruals and existing cash balance.
“KPCL is a crown jewel to join APSEZ’s string of pearls, our network of 10 economic gateways to India and this acquisition would accelerate our stride towards FY2025 vision of handling 400 MMT of cargo,” Karan Adani, CEO of APSEZ said in a statement.
“Given the best-in-class infrastructure and the distinct hinterland catered by KPCL, this acquisition will not just increase our market share to 27% but also add remarkable value to our pan-India footprint.”
“With the experience of successfully turning around acquisitions of Dhamra and Kattupalli ports, we are confident of harnessing the potential of KPCL and improve returns to stakeholders,” Adani added.
APSEZ will target to enhance cargo volume at KPCL to 100 MMT in around 7 years and will double its EBIDTA in around 4 years through its process improvements and industry best practices.
The acquisition is subject to regulatory approvals. The transaction is expected to be completed in 120 days.