AMP Capital eyes exit from Gujarat Pipavav

Written by Reghu Balakrishnan | Mumbai | Updated: Nov 17 2009, 05:51am hrs
AMP Capital Investors, the Australia-based specialist investment manager with A$90 billion in funds under management, is looking for an exit from its investment in Gujarat Pipavav Port Ltd (GPPL). The exit of AMP, which had acquired less than 10% stake for about Rs 200 crore, is reportedly to take place through an IPO, for which GPPL will submit a draft red herring prospectus (DRHP) with SEBI soon, said sources.

Acknowledging their plan, Anoop Seth, MD, Asian Giants Infrastructure Fund, AMP Capital Advisors Indian Pvt Ltd, said, "We had invested in GPPL in 2001 and now are considering an exit from the investment." However, he did not divulge the route of exit, whether through an IPO or a strategic sellout.

On its plans of an IPO, Prakash Tulsiani, managing director, GPPL, told FE, From time to time, whenever the need arises, the company (Board of Directors) considers various options for raising funds for the next stage of growth.

GPPL, which had submitted a draft red herring prospectus (DRHP) with SEBI in order to float an IPO to raise Rs 500 crore during September last year, had withdrawn its plans due to bad market conditions.

With a 54% stake, APM Terminals is the largest shareholder in Port Pipavav. Apart from AMP Capital, other shareholders, including New York Life International India Fund (Mauritius) LLC, IDFC Infrastructure Fund, IL&FS Trust Company Ltd, Jacob Ballas Capital India Pvt Ltd, Unit Trust of India and Industrial Development Bank of India, hold the remaining 46% stake in the company.

GPPL has container volume of about 1,95,000 TEUs (twenty-foot equivalent unit-20-foot container or its equivalent) and 2.5 million tonnes in bulk in 2008. There is a growth of over 60% this year till last month. Vikram Suryavanshi, research analyst with Karvy Stock Broking, said there is immense potential for minor ports as there is a need for doubling the capacities of freight handling in next five to seven years.

On the growth prospects of GPPL, he said, Major ports such as Kandla and JNPT are in full capacity now, which will results in more cargo handling by ports such as Gujarat Pipavav, which can also gain advantage from industrial development coming up in Gujarat. As the market conditions improve, the PE-backed companies are in a cheerful mode as far as the IPOs are concerned. About 15 PE-backed companies have filed DRHP recently to tap the booming market. Recently, AMP bought minority stakes in Quippo Telecom and Gayatri Infrastructure through its Asian Giants Infrastructure Fund.