The Ahmedabad-based Adani Group has finalized the
terms and conditions to buy out construction major Larsen & Toubro (L&T) and Tata Steel's stakes in Dhamra Port Company Limited (DPCL) in Odisha for an enterprise valuation of close to $1 billion (about
Rs 5,500 crore). The deal was agreed in a recent meeting between Adani Group
Chairman Gautam Adani, L&T Chairman A M Naik and Tata
Group's new Chairman Cyrus Mistry.
An announcement is expected in the next few days, said a
source directly involved with the talks. Adani, which operates India's biggest
private port at Mundra in Gujarat, will fund the deal from its own funds, the
source added. This will be the second attempt by the Adani group to buy a port
in eastern India after its bid for the Chennai port terminal was rejected on
security grounds.
L&T and Tata Steel own 50 per cent stake each in the
Dhamra project. With this acquisition, Adani will get a grip in the eastern
coast.
When contacted, an L&T spokesperson said: “As a matter
of policy, L&T neither confirms nor denies market speculation.” Email
questionnaires to Adani and Tata Steel did not elicit any response till the
time of going to press.
Dhamra Port's project cost is about Rs 3,600 crore and it
reported a total income of Rs 198 crore for FY12, with a net loss of Rs 458
crore. As this was the first year of operations, it had high amortization and
interest costs, along with initial ramp-up traffic, the company said in its
annual report.
The port has been developed under the
build-own-operate-share and transfer model with a concession from Odisha
government for 34 years. The port, which commenced operations in May 2011
handled 5.1 million tonnes of cargo during that year. The port's location makes
it ideal for shipment of minerals and raw material for steel plants in the
region.
For Adani group, the acquisition of Dhamra Port will be
an important milestone in the group's plan to set up ports all over India. The
group currently operates Adani Ports in Gujarat, the second-largest commercial
port infrastructure company and the largest private port operator in India.
The group is also constructing ports in Hazira, coal berths
in Mormugao, Vizag and a dry bulk terminal in Kandla.
Sourced
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