Adani Ports Acquires Stressed Karaikal Port For Rs 1,485 Crore Under Bankruptcy Law

APSEZ has acquired KPPL for Rs 1,485 crore under India's bankruptcy law, after the resolution plan was cleared by a court in Chennai.

The stressed port, based in Puducherry, is now owned by Adani Ports and Special Economic Zone Ltd.

APSEZ stated that the acquisition price implies an enterprise value/EBITDA ratio of around 8 times the estimated FY23 figures.

The company will spend further Rs 850 crore over time to upgrade infrastructure in order to reduce the logistics cost for the customers, APSEZ said in a statement on Sunday (2 April).

"We are envisaging to double the capacity of the port in the next 5 years and also add container terminal to make it a multipurpose port," said APSEZ CEO Karan Adani.

With acquisition of Karaikal port, APSEZ now operates 14 ports in India.

The port operator intends to manage 500 mt of cargo by 2026, and wants to become both the world's largest port operator and India's biggest transport utility by 2030.

Karan Adani said acquiring Karaikal Port strengthens the port operator's position as India's biggest transport company.

Karaikal Port is an all-weather deep-water port on India’s eastern coast that was developed on the Build, Operate and Transfer (BOT) format under the Public-Private Partnership by the Government of Puducherry.

The Port was commissioned in 2009, and was developed in the Karaikal District of the Union Territory of Puducherry, around 300 Km south of Chennai.

It is the only major port between Chennai and Tuticorin, and its strategic location allows the port easy access to industrial-rich hinterland of Central Tamil Nadu.

The port gets a 14-meter water draft and has land area of over 600 acres.

Its existing infrastructure includes five operational berths, three railway sidings, mechanised bulk cargo handling system including mechanised wagon-loading and truck-loading systems, two mobile harbour cranes and a large cargo storage space that includes open yards, 10 covered warehouses and four liquid storage tanks.

With a built-in cargo handling capacity of 21.5 MMT, the port primarily handles Coal, Cement, Fertiliser, Limestone, Steel and Liquids.

The upcoming CPCL’s 9 MMTPA new refinery at Nagapattinam in Tamil Nadu presents an opportunity for Karaikal Port to handle an additional large volume of liquid cargo, APSEZ said.

Karaikal Port is the second port to be acquired by APSEZ under the Insolvency and Bankruptcy Code (IBC) after Dighi port in Maharashtra.