The Gujarat Maritime Board (GMB) has decided to divest its 26 per cent stake in Adani Ports Ltd after the project enters operation and maintenance phase early next year.
Sources said that this divestment would be made in favour of Adani Exports Ltd, the promoters of the project. The project had achieved financial closure in mid-1997. This port is still under construction and undergoing trial operations.
GMB sources said a detailed valuation exercise was underway. Though no fixed formula for working out the divestment price has been worked out, the shares are expected to be valued on the basis of profit earning capacity. This would imply estimating the future revenue flows into the project and working out the divestment price.
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Adani will be the second port in which the GMB is divesting its stake to allow the management flexibility of operations, and booking capital gains in the process. The funds generated through such operations are to be deployed for the development of a series of port projects in the Gulf of Kutch and in the Gulf of Cambay. The projects include dedicated terminals for handling chemicals, petroleum products and bulk cargo.
The divestment is in line with the GMB's policy of booking capital gains and deploying the funds earned for developing more projects. The sources said that GMB had divested its stake in Pipapav Ports Ltd where also it had a 26 per cent stake. It earned Rs 55 crore on its investment of Rs 11 crore.
The project is being implemented on a build, own, operate and transfer (BOOT) basis for a 30-year concession period.
The promoters already have an equity stake of 40 per cent which was one of the conditions imposed by Industrial Finance Corporation of India (IFCI) which arranged the debt. The Rs 340 crore port is being funded on a 60:40 debt equity ratio.
In addition, this port has also been provided with physical asset cover for raising debt finance. Such physical asset cover is possible only in a BOOT template which allows the promoters to mortgage jetties and some of the physical assets other than the waterfront areas to the creditors.
The sources said the project when would have the capacity to handle about 3.5 million tonnes of cargo, making it one of the largest ports in the country despite being classified as a minor port. This includes, bulk and container cargo handling facilities. The port, the sources said would have be in a position to provide storage facilities of up to 1 lakh kilo litres of liquid bulk cargo. In addition the port would also have a two kilo metre long jetty with accompanying pipelines to enable discharge of petroleum and crude oil, the sources added.
he ports draft, the distance between the bottom of the vessel and floor of the sea, is about 12.5 metres. Accordingly the port can offer docking facilities for vessels of over 40,000 dead weight tonnes.