Adani Ports and Special Economic Zone (APSEZ), India’s largest private port operator, has entered into a definitive agreement to acquire a 95% stake in Gopalpur Port, Odisha, for an equity value of Rs 1,349 crore ($161.74 million). This strategic acquisition aims to bolster Adani’s presence on India’s eastern coast, complementing its existing operations at Dhamra Port in Odisha’s Bhadrak district.
However, the acquisition is still awaiting approval from the Odisha government. According to an official source, the acquisition proposal will soon be placed before the state cabinet and is expected to be cleared in a meeting chaired by Chief Minister Mohan Majhi.
In March this year, APSEZ reached a definitive agreement to purchase a 56% stake from the Shapoorji Pallonji (SP) Group and a 39% stake from Orissa Stevedores Limited (OSL) in Gopalpur Port Limited (GPL). The acquisition is based on an enterprise value of INR 3,080 crore, with the transaction subject to statutory approvals and the fulfillment of other conditions precedent.
The strategic significance of Gopalpur Port
Gopalpur Port, located on the east coast of India, has a handling capacity of 20 million metric tonnes per annum (MMTPA). In 2006, the Government of Odisha awarded a 30-year concession to GPL to operate and develop the port, with the option of two extensions of 10 years each. The port is a deep draft, multi-cargo facility that handles a diverse mix of dry bulk cargo, including iron ore, coal, limestone, ilmenite, and alumina. It plays a critical role in supporting the growth of mineral-based industries in the region, such as iron and steel, alumina, and other sectors.
The concessionaire enjoys full flexibility to design and expand the port infrastructure as per market demand. To facilitate the expansion, GPL has received over 500 acres of land on lease, with an option to acquire additional land for future capacity expansions. This strategic acquisition by Adani Ports is expected to enhance the port’s capability and attract more business, benefiting the regional economy and contributing to India’s overall maritime infrastructure development.
Connectivity and prospects
Gopalpur Port is well-connected to its hinterland through the national highway NH16 and a dedicated railway line linking the port with the Chennai-Howrah main line. This strategic connectivity ensures seamless transportation of cargo, enhancing the port’s efficiency and competitiveness.
In addition to the initial enterprise value, there is a contingent consideration of INR 270 crore, estimated to be payable after 5.5 years, subject to the fulfillment of certain conditions agreed upon with the sellers. This clause indicates the potential for future expansion and increased revenue generation for Adani Ports.