Source: http://www.portwings.in/ports/adani-group-to-take-over-lts-kattupalli-terminal/
Port Wings News Network:
Adani Group, headed by Mr Gautam Adani and one of India’s
leading business houses with revenue of over $10 billion, is all set to take
over the Kattupalli International Container Terminal (KICT), promoted by engineering
major Larsen & Toubro at Kattupalli Port in Tamil Nadu, it is reliably
learnt.
In what could be an early indication of possible takeover
of the terminal, said to be from the first week of September this year, officials
of Adani Group and KICT have jointly organized a trade meet with the prominent seafood
exporters in the region in Chennai on July 24 and sought the trade’s support.
Speaking to Port Wings, one of the exporters (who
attended the trade meet), seeking anonymity said that they (Adani Group) were
very eager to ascertain the potential of seafood trade from the region and also
gave assurance to the trade that they can walk an extra mile to ensure
hassle-free exports from Kattupalli.
The news of possible takeover could not be verified from
either side, as they were reluctant to share any information pertaining to the
development citing different reasons.
STAKEHOLDERS OF KATTUPALLI PORT:
Kattupalli Port is promoted by L&T Ports, a division
of L&T Shipbuilding Limited, a joint venture company formed by Larsen &
Toubro Limited and Government of Tamil Nadu’s trade arm Tamil Nadu Industrial
Development Corporation Limited (TIDCO). While the L&T holds 97 % in the shipyard
cum port complex project, Tamil Nadu Government (through TIDCO) holds 3 %
share.
RUMOURS GAINING GROUND:
Though rumours of Adani Group taking over the Kattupalli
Container Terminal were flying for the past few weeks, no one from both the
listed companies gave any concrete information about it in the public domain.
However, developments like a joint trade meet by Adani
Group and L&T few days ago has clearly hinted that there are some concrete
developments happening behind the scene on the possible taking over of the
terminal.
ADVANTAGE FOR ADANI:
For Adani Group, which wants to strengthen its presence
in the East Coast, the possible taking over of L&T’s container terminal,
located within a few kilometers distance from its own project, a container
terminal (now in construction phase) at Kamarajar Port (erstwhile Ennore Port),
could help to secure calling of vessels (mainline, feeder and coastal) from the
day one of its operation.
Besides, maritime analysts suggest that it could further
help the Adani Group to project both the terminals as a largest hub for
containers in East Coast.
Furthermore, sources monitoring the growing port
landscape in the country clearly pointed out that the Adani Group plans to
project both the terminals as “Mundra of East Coast.”
It may be noted that Adani Group recently got the Vizhinjam
port project in Kerala and in 2014, Adanis acquired Dhamra Port in Odisha from
Tata Steel and L&T for an estimated Rs 5,500 crore.
ADVANTAGE FOR L&T:
According to sources, the possible handing over of
Kattupalli Container Terminal to Adani by September would also augur well for
the L&T management, which intends to focus more on defence projects at its
shipyard located in the Kattupalli port complex.
POSSIBLE HURDLES:
Even though the managements of Adani and L&T may have
discussed about the critical points involved in the possible take over from the
legal point of view, experts feel that the “transition” may not be that easy.
The Tamil Nadu Government roped in the L&T to develop the port complex and
initially there were no reference about operation of container terminal.
Besides, it is not clear, whether the L&T management handover “absolute
right” on container terminal to Adani Group. If the L&T management intends
to give to total control, then it needs the concurrence of the Tamil Nadu
Government, another stakeholder in the port project.
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