Adani plans $400 mn IPO for Mundra

The Adani Group's Mundra Port plans to raise $400 million from its initial public offering (IPO) for expansion of facilities.

Mundra Port as well as its adjoining special economic zone located on the west coast will become the first Indian port to go public in June this year, said company sources.

The port will also offload 10 per cent of its stake or around 40.25 million shares to the public, foreign institutional investors, Indian financial institutions and insurance companies. The funds raised from the Mundra Port and Special Economic Zone (MPSEZ) listing and stake sale will largely go toward the expansion of Mundra and two other ports.

The port owner will set aside $158 million from the equity sale to develop the Mundra Port and build infrastructure, including roads, by 2010, according to senior port officials. The company will also spend a further $68 million to build a terminal for coal and other general cargo.

The listing proposal follows a major restructuring exercise, which made the MPSEZ the operator and holding company for three port projects - Mundra, Dahej and Dholera, apart from the sprawling SEZ.

Mundra and the proposed Dholera port is wholly-owned by the Adani Group, while the Dahej Port is being developed in partnership with Petronet LNG, with the Adani Group holding a 50 per cent stake.

MPSEZ officials said the company would invest around $57 million in Dahej's equity and the total project cost was expected to be around $273 million. The Petronet and Adani project envisages building a bulk cargo port for products such as coal, steel and fertilizer, which will be completed in two phases within 36 months.