 "Adani Ports")
Adani Ports and Special Economic Zone Ltd (APSEZ) has entered into a non-binding agreement with L&T Shipbuilding for evaluating the operations of the port at Kattupalli, Tamil Nadu, for a month.
“The definitive agreements would be entered into later,” it told the exchanges on Thursday. “While all non-operating revenues and expenses will be to L&T's account, Adani shall be responsible for Ebitda (operatign earnings) gains and losses arising from the port operation for this period (starting October 1). The shipyard will continue to be managed and operated by L&T.”
In July, Business Standard was the first to report that Adani Group planned to take over the operational and management control of the Larsen & Toubro (L&T) Kattupalli International Container Terminal near Chennai.
The move is to strengthen its presence in the east coast.
L&T built the port at a cost of Rs 4,000 crore. Adani Group were looking at Gangavaram in Andhra Pradesh, Karaikkal (near Puducherry) and L&T’s Kattupalli. Gangavaram did not work out due to a high valuation. Karaikkal has some other issues, though still under consideration.
Adani recently got a nod to develop the Vizhinjam port in Kerala. Last year, APSEZ had acquired Dhamra Port in Odisha from Tata Steel and L&T Infrastructure, for an estimated Rs 5,500 crore. Adani is also developing a Rs 1,270-crore container terminal inside Ennore Port and the first phase is expected to be ready by January. The total capacity would be 1.2 million twenty-foot equivalent units (TEUs), of which 0.8 million TEUs will be ready in the first phase.
Sources said Adani might face hurdles in buying out the Kattupalli terminal because the Tamil Nadu government gave its concession on the condition that L&T operates both the naval yard and container terminal. Kattupalli's container terminal has two berths and handles 1,200 containers a month.
L&T Shipbuilding is a joint venture between L&T and Tamilnadu Industrial Development and Corporation; the former has 97 per cent and Tidco holds three per cent.
Both the shipyard and port have SEZ status.
