Adani Group-owned Mundra Port and Special Economic Zone (MPSEZ) has announced the acquisition of Abbot Point Port in Australia in an all-cash deal for A$1.8 billion (around $2 billion or Rs 9,000 crore approximately). The company expects to close the deal by June, 2011.
In a communiqué to the exchanges, top company officials informed that the sale purchase agreement was signed on Tuesday morning between Queensland government officials and the director of Mundra Port Pty Ltd – a fully owned subsidiary of Mundra Port SEZ Ltd in Brisbane, Australia. The company emerged as a successful bidder for the 99-year lease of Abbot Point X 50 Coal Terminal (APCT), following the international competitive bidding by the state of Queensland in Australia. This acquisition also marks the beginning of expansion of MPSEZ outside India.
The deal is partly funded through an acquisition debt and a small portion of equity from MPSEZ. The balance sheet size of the company will be more than double post acquisition. The revenue from the port operations are expected to nearly triple to A$305 million (Rs 1,470 crore approx.) by 2016 from A$110 million (Rs 530 crore approx.), estimated for 2011. The EBITDA margins are also believed to rise from the current 54 per cent to about 70 per cent after the expansions at the port in the next five years.
In 2007, Mundra Port and Special Economic Zone (MPSEZ) raised $100 million from GIC Special Investments Pte Ltd. , 3i Group Plc and $120 million from GIC Special Investments Pte Ltd. , T. Rowe Price, ICICI Bank Ltd., Infrastructure Development Finance Co. Ltd. in the same year.
According to the company, the size of the balance sheet would be double after the acquisition. “It more than doubles its present balance sheet size and adds a capacity of 50 million tonnes. It is expected to have revenues of A$110 million in 2011 with EBDITA of A$59 million; EBDITA margin is 54 per cent in 2011 and it will gradually increase to 70 per cent in 2016. It will then have revenues of A$305 million and EBDITA of A$213 million in 2016.”
“We have harboured aspirations to expand globally and were in search of the right business opportunity with strategic fit. Abbot Point is our contribution to India’s increasing global ambition and it will boost synergy with other business of the group,” said Gautam Adani, chairman of the Adani Group, in an official statement.
Adani had acquired a coal asset of Linc Energy Ltd (LNC) for about $2.7 billion (Rs 12,500 crore approx.) in August last year, gaining control of the Galilee tenement in Queensland. In the past 10 years, the asset base of MPSEZ across the globe has risen to about $3 billion from the previous $100 million. The group has achieved a cargo handling capacity of above 200 million tonnes per annum (MTPA) from about 2.5 MTPA in 2001.