Adani completes acquisition of Dhamra Port in Odisha

Written by PTI | New Delhi | Updated: Jun 24 2014, 02:33am hrs
Adani Ports and Special Economic Zone (APSEZ) today said it has completed the acquisition of Dhamra Port in Odisha from Tata Steel and L&T Infrastructure Development Projects (L&T IDPL).

"APSEZ has completed the acquisition of 100 per cent stake in the Dhamra Port Company Limited from L&T IDPL and Tata Steel," it said in a filing to the BSE.

In May, it has executed a pact with both the companies to acquire the Port for about Rs 5,500 crore.

"The Dhamra port acquisition now gives us an opportunity to replicate the development and phenomenal growth of the Mundra port on the eastern coast of India and thereby continue to execute on our pan-India strategy," Gautam Adani, Chairman of the Adani Group has said last month.

An equal joint venture between L&T IDPL and Tata Steel, Dhamra Port Company Ltd (DPCL) was commissioned in May 2011 with an 18-km approach channel and a dedicated 62.7 km rail link to Bhadrak.

The port handled 14.3 million tonnes of cargo in 2013-14.

DPCL, the operator, had been awarded a concession by the Odisha government to build and operate the port on Dhamra river in Bhadrak district for 34 years, including four years for construction.

The concession period may be extended by two additional terms of 10 years each. The first phase construction, at an investment of Rs 3,200 crore, started in March 2007.

Following the acquisition, the second phase of development will be initiated within 90 days and completion targeted in 30 months, Adani Ports has said.

"The expansion will allow the Dhamra port to exceed 100 million tonnes of cargo capacity by the year 2020 and therefore allow Adani Ports to fulfil its stated vision of becoming a 200 million tonne ports business well before the year 2020," it has said.

Adani Ports is country's largest port operator with its flagship Mundra Port in Gujarat being the largest commercial port in India.

"As part of Tata Steel's review of its investments portfolio, board of the company has approved the divestment of its equity holding in the joint venture at an attractive valuation," Tata Steel has said earlier.

Tata Steel has entered into a long-term cargo handling pact with DPCL to secure long-term requirement and access to a deep-water port for its operations in Jamshedpur and Odisha, it has said.

Mundra, the largest port in the country, recently crossed the 100 million tonne mark in annual cargo handling. The Adani group owns five ports and is developing ports in Kandla and Ennore.

Dhamra Port handles coal, iron ore and other minerals, Bhattacharya said, adding that it would handle different types of cargo in the coming days. The company expects 15-20 per cent increase in cargo at the port in this financial year.

The shares of APSEZ closed at Rs 236.40 apiece on BSE, up 1.79 per cent from the previous close.