Adani Group May Purchase Deepwater Port in Andhra Pradesh
Indian energy and industrial giant Adani Group is said to be in discussions to take a majority stake in Krishnapatnam Port, a large bulk and containerized cargo port on the coast of Andhra Pradesh.
The deal, first reported by Hindu Business Line, would see Adani pay about $760 million for a 70 percent stake in Krishnapatnam Port Company.
In a note to investors, Adani Group did not explicitly deny the possibility of a deal, but it said that there was no activity related to Krishnapatnam that it would be obligated to discluse. "The Company does not comment on speculative news reports or rumours," the firm wrote. "At this point in time, there is no event/information that requires disclosure."
Adani's port division, Adani Ports and Special Economic Zone (APSEZ), is the largest private terminal operator in India. It currently operates ten sites, including two ports and two terminals on India's east coast, and it hopes to double its annual cargo tonnage across all of its operations by 2025.
Krishnapatnam Port Company is a division of CVR Group, an industrial conglomerate based in Hyderabad. CVR, in partnership with London-based private equity firm 3i Group, holds a 50-year concession from the government of Andhra Pradesh to develop the Krishnapatnam port site on a build-operate-share-transfer basis. Since its inception in 2008, the port has grown to handle about 40 million tonnes of dry bulk and 500,000 TEU in container volume per year.
With a channel depth of 60 feet, Krishnapatnam stands out among Indian ports for its ability to handle large ships. It is deep enough to handle laden Capesize bulkers - a potentially valuable prospect for Adani Group, which has plans to import coal from Australia for at least a portion of its extensive power plant operations.