Adani Ports and Special Economic Zones (APSEZ) said on Monday that it has acquired NCLT Ahmedabad and NCLT Hyderabad licenses to acquire the remaining 58.1 percent ownership in Gangavaram Port Limited (GPL) through a composite scheme of arrangement. With the acquisition of the remaining 58.1 percent stake, APSEZ will hold 100% of Gangavaram Port, and this stake purchase will be accomplished through a share swap arrangement.
Adani Ports announced that the National Company Law Tribunal (NCLT), Ahmedabad Bench had approved a composite scheme of arrangement between Visakhapatnam’s Gangavaram Port and Adani Ports & Special Economic Zone (SEZ) and Adani Gangavaram Port.
In a statement from one of the officials of the company said that it has secured permission from NCLT Ahmedabad and NCLT Hyderabad to acquire the remaining 58.1 percent ownership in Gangavaram Port Limited (GPL) under a composite plan of arrangement. GPL will become an owned subsidiary of APSEZ because of this stake transaction.
The deal implies an EV/EBITDA multiple of about 7.8 times (FY22 EBITDA of Rs796 crore), which adds value to Adani Port shareholders.
Adani Port (APSEZ) has already bought 31.5 percent of the company from private equity firm Warburg Pincus and 10.4 percent from the Government of Andhra Pradesh during fiscal year 22.
The acquisition of GPL is estimated to cost around Rs 6,200 crore (517 million shares at Rs 120 per share). As of March 2022, GPL was debt-free, with a cash balance of Rs1,293 crore.
Ports will have a significant impact on the future. The Adani Group’s pan-India cargo presence will be expanded because of Adani Port’s acquisition of GPL.
Adani Ports & Special Economic Zone Ltd. designs, builds, operates, and maintains port and port-related infrastructure. It works in two commercial sectors: port and special economic zone (SEZ) activities, and others. The Port and SEZ Activities section includes infrastructure development activities. Airplane operating income, utility services, and passenger rail services are all included in the Others category.
Adani Port’s presence in 13 domestic ports spanning seven maritime states (Gujarat, Maharashtra, Goa, Kerala, Andhra Pradesh, Tamil Nadu, and Odisha) provides the most extensive national footprint with enhanced hinterland connectivity. The company was founded on May 26, 1998, by Gautambhai Shantilal Adani and is headquartered in Ahmedabad, India.
GPL is in northern Andhra Pradesh, near Vizag Port.
It is the second largest non-major port in Andhra Pradesh, with a capacity of 64 MT, and was built under a concession granted by the Government of Andhra Pradesh (GoAP) that runs until 2059.
Furthermore, GPL is an all-weather, deep-water, multifunctional port capable of handling fully laden super cape-size vessels weighing up to 200,000 DWT, according to the statement.
The port managed cargo volumes of roughly 30 million metric tonnes in the fiscal year 2022, producing revenue of Rs 1,206 crore and EBITDA of Rs 796 crore, resulting in an EBITDA margin of 66%, according to Adani Ports. GPL is debt-free, with a cash position of Rs 1,293 crore at the end of March 2022.
According to Adani Port director Karan Adani, the acquisition of GPL is a critical milestone in solidifying its position as India’s leading transport utility and achieving east coast & west coast parity. Gangavaram Port is an all-weather deep-water multifunctional port with a capacity of 64 MMT and a concession period that runs until 2059. GPL carried 30 MMT cargo and reported an income of Rs 1,206 crore in the Fiscal Year 2022.
The port handled 17.3 MMT cargo in the first six months of the Fiscal year 2024, according to Adani Port. Adani Ports and Special Economic Zones, India’s largest private port and logistics enterprise, is the flagship transportation component of the diversified Adani group.
