Adani Ports and Special Economic Zone Ltd (APSEZ), India’s largest private port operator, has completed the acquisition of Krishnapatnam Port Co. Ltd (KPCL) for an enterprise value of ₹12,000 crore, nearly 13% lower than what was originally agreed upon.
The deal gives APSEZ a controlling stake of 75% in KPCL, the Adani group said in a statement.
APSEZ bought the stake from Hyderabad-based privately held conglomerate CVR Group and other investors.
APSEZ had on 3 January signed the deal to buy KPCL at an enterprise value of ₹13,752 crore. However, the covid-19 pandemic led the Adani group to temporarily halt several acquisitions, including that of KPCL, in a bid to re-evaluate its plans and renegotiate lower deal costs, Mint had reported in June. Krishnapatnam port is a multi-cargo facility port in the southern part of Andhra Pradesh. In FY21, KPCL is expected to generate an Ebitda (earnings before interest, taxes, depreciation and amortisation) of approximately ₹1,200 crore, resulting in an acquisition EV (enterprise value)/ Ebitda multiple of 10, APSEZ said in a press release.
The deal will accelerate APSEZ’s stride towards handling 500 million tonnes by 2025 and is another step in implementing its strategy of cargo parity between the west and east coasts of India, the Adani group said.
“I am happy that KPCL, the second-largest private port in India, has now become part of APSEZ portfolio,” said Karan Adani, chief executive and director of APSEZ.
“Our experience of turning around acquisitions like Dhamra and Kattupalli ports will enable us in harnessing the potential of KPCL. We will target to enhance throughput at KPCL to 100 million tonnes by FY25 and double its Ebidta by FY23,” he added.
APSEZ’s 11 ports and terminals — Mundra, Dahej, Kandla and Hazira in Gujarat, Dhamra in Odisha, Mormugao in Goa, Visakhapatnam in Andhra Pradesh, and Kattupalli and Ennore in Tamil Nadu—make up 24% of the country’s total port capacity.
