Adani to acquire Kattupalli port from L&T

The Tamil Nadu government has reportedly given approval to Adani Ports and Special Economic Zone Limited (APSEZL) to acquire Kattupalli port from L&T Shipbuilding Limited (LTSB), a unit of Larsen &Toubro (L&T). The in-principle agreement for the strategic acquisition of the port was signed between APSEZL and L&T in November 2015. However, the companies did not disclose the financial details of the transaction. L&T holds 97 per cent equity stake in LTSB, while the Tamil Nadu Industrial Development Corporation, an undertaking of the Tamil Nadu government, holds the remaining 3 per cent. While approving the demerger, the state government has kept the original terms of the agreement that it had signed with L&T unchanged. L&T was contractually mandated to pay the state either a revenue share or royalty per standard container handled at the terminal, whichever was higher. APSEZL will now have to follow the same terms.


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