Karaikal Port acquired by Adani Ports

Adani Ports and Special Economic Zone Ltd (APSEZ) announced on Saturday that it had completed the acquisition of Karaikal Port Private Limited (KPPL) with the approval of the National Company Law Tribunal (NCLT).

APSEZ had previously been declared a successful resolution applicant under KPPL’s Corporate Insolvency Resolution Process (CIRP).

Karaikal Port is an all-weather deep-water port on India’s eastern coast that was built, operated, and transferred by the Government of Puducherry through a Public-Private Partnership.

The Karaikal Port was built in the Karaikal District of the Union Territory of Puducherry, about 300 kilometers south of Chennai. It is the only major port between Chennai and Tuticorin, and its strategic location allows it easy access to Central Tamil Nadu’s industrially rich hinterland.

According to an official statement from APSEZ, the acquisition consideration of Rs 1,485 crore implies an EV/EBITDA multiple of 8x on the FY23 estimated numbers.

Karaikal Port

According to the statement, the port is close to Tamil Nadu’s containerized cargo-originating industrial centers and the upcoming 9 MMTPA CPCL refinery.

“The acquisition of Karaikal Port is another significant step toward consolidating our position as India’s largest transport utility.” “With the acquisition of Karaikal port, APSEZ now operates 14 ports in India,” APSEZ CEO and Whole-time Director Karan Adani stated.

“APSEZ will invest an additional Rs 850 crores in infrastructure over time to reduce logistics costs for customers.” “We plan to double the port’s capacity in the next five years and add a container terminal to make it a multipurpose port,” he added.

The port has a water draft of 14 meters and a land area of over 600 acres. Its existing infrastructure includes 5 operational berths, 3 railway sidings, a mechanized bulk cargo handling system with wagon-loading and truck-loading systems, 2 mobile harbour cranes, and a large cargo storage space with open yards, 10 covered warehouses, and 4 liquid storage tanks.

The port primarily handles coal, cement, fertilizer, limestone, steel, and liquids and has a built-in cargo handling capacity of 21.5 MMT. The upcoming CPCL 9 MMTPA new refinery in Nagapattinam, Tamil Nadu, provides an opportunity for Karaikal Port to handle a larger volume of liquid cargo.