As per the finalised agreement, Adani Ports would be acquiring 16.3 crore shares of Warburg Pincus in GPL.
Adani Ports and SEZ Ltd (APSEZ) is acquiring 31.5 percent stake held by Windy Lakeside Investment - an affiliate of Warburg Pincus - in Gangavaram Port (GPL), the company said on March 3.
The acquisition is valued at Rs 1,954 crore and subject to regulatory approvals.
As per the finalised agreement, Adani Ports would be acquiring 16.3 crore shares of Warburg Pincus in GPL, at a price of Rs 120 each, said an official press release.
With the completion of this deal, APSEZ, a key subsidiary of the diversified Adani Group, has expanded its market share to above 30 percent at 12 locations across India.
The company is also in discussion with DVS Raju and family for their 58.1 percent stake - approximately 30 crore shares in GPL. The remaining 10.4 percent stake in the port is held by the Andhra Pradesh government.
The GPL is located in the northern part of Andhra Pradesh, next to Vizag Port. It is the second largest non-major port in the state with a 64 MMT capacity established under concession from the Government of Andhra Pradesh (GoAP) that extends till 2059.
Currently, GPL operates 9 berths and has free hold land of around 1,800 acres, APSEZ said in its statement, adding that with a master plan capacity for 250 MMTPA with 31 berths, GPL has sufficient headroom to support future growth.
"In FY20, GPL had a cargo volume of 34.5 MMT, generated revenue of Rs 1,082 crore, EBITDA of Rs 634 crore (margin of 59 percent) and PAT of Rs 516 crore," the APSEZ statement said, further noting that GPL is "debt free" with cash balance of over Rs 500 crore.
"The acquisition of GPL is a part of our continued strategy to build out a port and logistics network that is unmatched in its ability to serve customers across the nation," Karan Adani, CEO and Whole Time Director of APSEZ, said.
"We believe that GPL holds great potential to complement its bulk cargo terminals with new cargo categories that we intend to develop. The port provides us great access to an adjacent hinterland that was largely untapped by APSEZ thereby placing us in a position to serve a broader set of port customers as well as expand our overall hinterland logistics footprint for a much larger base of customers," he further added.
Vishal Mahadevia, Managing Director of Warburg Pincus India, said the company "looks forward to the port’s continued success in partnership with the Adani Group".
"Warburg Pincus has been a supportive partner in this journey, and we look forward to the Adani Group’s contributions in the next phase of the port’s growth," DVS Raju, Chairman of Gangavaram Port, said.