India's Adani Group is likely to take over the operational and management control of Larsen & Toubro (L&T) Kattupalli International Container Terminal near Chennai, reports Business Standard.
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 ($645 million).
It is learnt that the AP Moller–Maersk Group, a Danish business conglomerate, is also in the race to acquire the container terminal operations of the Katupalli port.
Adani Ports and Special Economic Zone Ltd is evaluating the option of taking over the operation and maintenance of other ports too. Also on its radar are ports in Gangavaram, Andhra Pradesh, and Karaikal, Puducherry.
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.”
Adani Ports operates a coal terminal at Vishakapatnam port and has got a contract to operate a container terminal at Kamarajar port. However, it wants to operate a whole port to handle bulk cargo, container and general cargo such as automobiles.
The Katupalli port being adjacent to the Kamarajar port fits well for the Adani group. The company can also acquire land between two ports for development, the source said.
L&T spokesperson said: “As a matter of policy, L&T neither confirms nor denies market speculation.”
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.
Recently, Adani Ports got a nod from the Kerala government to develop the Vizhinjam port. “The Adani group is going to be a major competitor for ports at Chennai, Ennore and VOC ports in Tamil Nadu, and other ports in the south,” said sources.