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Ennore port plans to raise Rs 400 crore

BS Reporter  |  Chennai 

Ennore Port Ltd, country’s first corporate port owned by the Union government, is planning to raise around Rs 400 crore through a private placement of shares to part-finance expansions. The port administration has said it may also look at initial public offering (IPO). The proposed fund raising is to create infrastructure, which in turn would bring in Rs 6,500 crore, according to the Union Shipping Minister.

Speaking to Business Standard at the sidelines of memorandum of understanding (MoU) signing ceremony, between EPL and Bay of Bengal Gateway is a special purpose vehicle (SPV) company formed to set up a Rs 1,407 crore container terminal at Ennore port, G K Vasan, Union Minister for Shipping said that “we have to look at all the options to raise the money.”

Earlier, the Minister said, 14 projects worth Rs 6,466 crore have lined up in the port. These projects include three dredging projects, seven terminal projects and four connectivity rail and road projects.

“Though major portion of the investment will come from the private players, we have to invest in creating infrastructure like dredging and connectivities.” Of the three dredging projects one project worth Rs 92 crore is already completed and two more projects worth Rs 640 crore have lined up. The port is also creating infrastructure to handle cars for the export markets, with an investment of around Rs 110 crore.

“To support our investments we will consider all the options for fund raising,” said Vasan, when asked whether EPL has any plans to raise money through private placements or for an

S Velumani, chairman and managing Director, EPL said, “we are planning to raise around Rs 300-400 crore and we have recommended for private placement.

If the market is good, we might consider also. Government has to take the final call,” he said.

The port is located 30 km from Chennai port and was set up under the Act, keeping it outside the scope of the for Major Ports, the tariff regulator for 11 of the 12 ports owned by the government.

The Ennore port, set up primarily to handle cargoes such as iron ore and coal, when it started operations in nine years ago. “By 2013-14 the port should handle 75 million tonnes and by 2020-21 to 90 million tonnes from the current 15 million tonnes,” said Vasan.

First Published: Fri, January 07 2011. 00:04 IST