APSEZ fully unlocks India’s eastern hinterland with Rs. 6,200 Cr acquisition of Gangavaram Port

• Completes Government of Andhra Pradesh’s stake Purchase in GPL             
• Board Approves merger of GPL with APSEZ

• APSEZ acquires Government of Andhra Pradesh’s 10.4% stake for Rs. 645 Cr
• APSEZ and GPL boards have approved a merger at a swap ratio of 159:1,000 shares
• With the above, APSEZ achieves full closure on Gangavaram Port Ltd 
• Acquisition earnings and value accretive to APSEZ shareholders

Ahmedabad, 22 September 2021: Adani Ports and Special Economic Zone Ltd (APSEZ), India’s largest private Ports & Logistics company and the flagship transportation arm of the diversified Adani Group, has concluded acquisition of Government of Andhra Pradesh’s (GoAP) stake of 10.4% with a consideration of Rs 645 Cr.

The boards of APSEZ and GPL have also approved the merger of GPL with APSEZ taking into consideration GPL’s valuation of Rs. 120 per share and fair value of APSEZ at Rs. 754.8 per share, resulting in a swap ratio of 159 shares in APSEZ for 1,000 shares in GPL for 58.1% stake held by DVS Raju and Family in GPL.  The merger, which has an appointed date of 1 April 2021 and is subject to NCLT approvals, is expected to conclude by 31 March 2022.

Earlier, in April 2021, APSEZ had acquired 31.5% from Windy Lakeside Investment Ltd, a Warburg Pincus affiliate, and had signed an agreement for controlling stake of 58.1% held by DVS Raju and Family. Post the merger of GPL and APSEZ, DVS Raju and family will receive approx. 4.8 Cr shares resulting in ~2.2% stake in APSEZ worth Rs 3,604 Cr.

GPL is debt free with strong growth potential as part of the APSEZ portfolio. Transaction has been completed at an equity value of ~INR 6,200 Crs and implies an EV/ FY21 EBTIDA multiple of ~8.8x and results in EPS accretion of ~7% to APSEZ FY 21 earnings.

GPL is a 64 MMT capacity non-major port established under concession from Government of Andhra Pradesh (GoAP) that extends till 2059 and is the gateway port for a hinterland spread over 8 states across Eastern, Western, Southern and Central India. This acquisition significantly expands APSEZ’s access to several new markets. As a deep draft modern multipurpose port capable of handling fully laden Super Cape size vessels of up to 200,000 DWT, GPL handles a diverse mix of dry and bulk commodities including Coal, Iron Ore, Fertilizer, Limestone, Bauxite, Sugar, Alumina, and Steel.

In FY21, GPL had a cargo volume of 32.8 MMT, revenue of Rs. 1,057 Cr and EBITDA of Rs. 625 Cr and PAT of Rs. 494 Cr. In Q1 FY22, GPL handled 8.7 MMT of cargo and reported revenue of Rs. 313 Cr, EBITDA of Rs. 215 Cr and PAT of Rs. 192 Cr. With several operational initiatives underway, GPL is all set to continue its strong growth and margin expansion.

“We are committed to accelerating the industrialization of Andhra Pradesh,” said Mr. Karan Adani, CEO and Whole Time Director of APSEZ. “The network of ports that we continue to build allows us to create an integrated mesh of logistics capabilities to deliver an unmatched set of services to our customers. Gangavaram is a major part of this mesh in one of India’s fastest growing states. We are excited about the growth prospects of GPL, which is core to our east coast expansion strategy. GPL is advantageously located to allow us unprecedented access to the largely untapped hinterland market.”

The addition of Gangavaram Port to the Adani Group’s pan-India port network tremendously strengthens APSEZ’s integrated logistics approach. With strong business momentum, capital structure efficiencies and a commitment to net zero emissions by 2025, APSEZ continues to deliver great value to its shareholders.

About Adani Ports and Special Economic Zone Ltd

Adani Ports and Special Economic Zone Ltd (APSEZ), a part of the globally diversified Adani Group has evolved from a port company to a Ports & Logistics Platform. It is the largest port developer and operator in India with 12 strategically located ports and terminals — Mundra, Dahej, Tuna and Hazira in Gujarat, Dhamra in Odisha, Mormugao in Goa, Gangavaram, Visakhapatnam and Krishnapatnam in Andhra Pradesh, Dighi in Maharashtra and Kattupalli and Ennore in Chennai — representing 24% of the country’s total port capacity, handling vast amounts of cargo from both coastal areas and the hinterland. The company is also developing a transshipment port at Vizhinjam, Kerala. Our Ports to Logistics Platform comprising our port facilities, integrated logistics capabilities, and industrial economic zones, puts us in an advantageous position as India stands to benefit from an impending overhaul in global supply chains. Our vision is to be the largest ports and logistics platform in the world in the next decade. With a vision to turn carbon neutral by 2025, APSEZ was the first Indian port and third in the world to sign up for Science Based Targets Initiative (SBTi) committing to emission reduction targets to control global warming at 1.5°C above pre-industrial levels.