Adani Ports and Special Economic Zone Ltd on Friday said that it will acquire a controlling stake of 75 percent of Krishnapatnam Port Company Ltd for around Rs 13,500 crore.
Located in the southern part of Andhra Pradesh, Krishnapatnam Port is a multi-cargo facility and handled 54 million tonnes (MT) in the financial year 2018-19.
In a statement, Adani Ports said that the purchase consideration of around Rs 13,500 crore would be funded through internal accruals and existing cash balance. The acquisition is subject to regulatory approvals and the transaction is expected to be completed in 120 days, it added.
According to the company, the acquisition would accelerate its stride towards 400 MMT by 2025.
Commenting on the development, Karan Adani, CEO and whole time Director of Adani Ports said, "This acquisition will not just increase our market share to 27 percent but also add remarkable value to our pan-India footprint."
Dubbing the Krishnapatnam port a "crown jewel to join Adani Ports's string of pearls", he added, "With the experience of successfully turning around acquisitions of Dhamra and Kattupalli ports, we are confident of harnessing the potential of Krishnapatnam port and improve returns to stakeholders," he added.
In August last year, a112-km long railway line project between Krishnapatnam port and Obulavaripalli was constructed, to ensure smooth transportation of minerals and industrial goods to and from the port. As part of the project, two tunnels were constructed -- one which is 6.7 km long and another, which is 1 km long.
Built at a total cost of Rs 1,993 crore, the project acquired land spread across 1,900 acres and has 9 stations along the route. Officials said that the project reduced the distance between Venkatachalam and Obulavaripalli by 72 km.