VIJAYAWADA: The Adani Ports and Special Economic Zone Limited (APSEZ) on Tuesday said it is acquiring the controlling stake of 58.1 per cent held by DVS Raju and Family in the Gangavaram Port Limited (GPL).
The acquisition is valued at Rs 3,604 crore and subject to regulatory approvals. Gangavaram port located next to Vizag port, is the second largest non-major port in Andhra Pradesh with a 64 million metric tonnes (MMT) capacity established under a concession from the Government of Andhra Pradesh (GoAP) that extends till 2059.
It is an all-weather, deep water and multipurpose port capable of handling fully-laden super capesize vessels of up to 200,000 DWT. At present, the GPL operates nine berths and it has freehold land of 1,800 acres. The GPL handles a diverse mix of dry and bulk commodities, including coal, iron ore, fertilisers, limestone, bauxite, sugar, alumina and steel.
The GPL is the gateway port for a hinterland spread over eight States across eastern, southern and central India. “With a master plan capacity for 250 MMT per annum with 31 berths, the GPL has sufficient headroom to support future growth,” a statement by the Adani Ports and Logistics said.
The GPL will benefit from the APSEZ’s pan-India footprint, logistics integration, customer centric philosophy, operational efficiencies and strong balance sheet to deliver a combination of high growth and improved returns, it said.
The company has a paid up share capital of 51.7 crore shares of which 58.1 per cent is owned by DVS Raju and Family (Promoter), 10.4 per cent by the government of Andhra Pradesh and 31.5 per cent Warburg Pincus. The APSEZ announced acquisition of 31.5 per cent stake of Warburg Pincus on March 3 for Rs 120 per share. It will acquire DVS Raju’s stake also at Rs 120 per share, which works out to a consideration of Rs 3,604 crore. With the latest acquisition, the APSEZ will have 89.6 per cent stake in the GPL.
Karan Adani, CEO and whole time director of APSEZ, said, "The acquisition of GPL is a further augmentation of our vision of capitalising on an expanded logistics network effect that generates greater value as it expands. Every additional node that we are able to add to our network allows us to deliver a greater level of integrated and enhanced solutions to our customers."
"In this context, GPL is a tremendous addition to our portfolio. The associated hinterland we will now be able to tap into is one of the fastest growing in the eastern region and with the logistic synergies APSEZ brings to the table, GPL has a potential to become a 250 MMT port. This will undoubtedly help accelerate industrialisation of AP. The Raju family has built a great port and we will continue to expand the world class asset," he added.
Welcoming the APSEZ acquiring the controlling stake in the GPL, Industries Minister Mekapati Goutham Reddy said the stake of the State government will be intact in Gangavaram port. There will be scope for more investment in the surrounding areas of Gangavaram, he added.