To strengthen its presence in the east coast, the Adani Group is likely to take over the operational and management control of Larsen & Toubro (L&T) Kattupalli International Container Terminal near Chennai.
Multiple sources have told Business Standard that Adani, which is led by chairman and founder Gautam Adani, is in the final stage of getting into an arrangement with L&T to take over the terminal, which the Mumbai-based construction and engineering major built at a cost of Rs 4,000 crore.
Responding to a query, a L&T spokesperson said: “As a matter of policy, L&T neither confirms nor denies market speculation.” An Adani spokesperson said: “We would not like to comment on any market speculation.”
According to a source close to the Adani Group, “They (Adani Group) were looking at Gangavaram in Andhra Pradesh, Karaikkal (near Puducherry) and L&T’s Kattupalli (near Chennai). Gangavaram did not work out due to high valuation. Karaikkal has some other issues, though it is still under consideration. L&T is a safer bet for them.”
It may be noted that Adani recently got a nod to develop the Vizhinjam port in Kerala. Besides, last year, Adani Ports and Special Economic Zone had acquired Dhamra Port in Odisha from Tata Steel and L&T Infrastructure for an estimated Rs 5,500 crore. Adani Port is also developing a Rs 1,270-crore container terminal inside Ennore Port and the first phase is expected to be ready by January next year. The total capacity of the terminal 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 to buy out the Kattupalli terminal because the Tamil Nadu government gave its concession on the condition L&T operates both Naval Yard and container terminal.
Kattupalli near Chennai caters to opportunities from East Coast (KG Basin) and South East Asia. The container terminal currently has two container berths and it handles 1,200 containers per month and got three regular services.
Shipping lines such as Maersk, Hyundai Merchant Marine (HMM) and Nippon Yusen Kaisha Lines (NYKL) made trail calls successfully. NYKL has commenced regular weekly call at Kattupalli Port.
L&T Shipbuilding Limited is a Joint Venture between L&T and Tamilnadu Industrial Development and Corporation Limited (TIDCO) wherein L&T holds 97% and TIDCO holds 3% in the Company to develop shipyard cum minor port complex.
Both the shipyard and the port have SEZ status.
Source: Business Standard
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