Adani Ports & Special Economic Zone Ltd (APSEZ), India's largest private port and special economic zone operator, has signed an agreement with France-based CMA CGM Group to develop a new common user container terminal at Mundra Port, as per a stock market disclosure.
The 50:50 JV will build the terminal which will have an annual capacity of 1.3 million twenty-foot equivalent units (TEUs). This will allow Adani Ports to handle 200 million metric tonnes of cargo well before its previous target of reaching the milestone by the year 2020. The firms did not disclose the amount to be invested in the JV.
This will be the fourth container terminal in Mundra and will be a 650-metre terminal along with 27 hectares of back area capable of handling 1.3 million TEUs annually.
Mundra will become India’s largest container port in 24 months, with the total container handling capacity reaching 5.5 million TEUs, the company said.
Adani Ports has already two containers located at Mundra and Hazira in Gujarat and has previously announced two container terminals to be constructed at Ennore in Chennai and Dhamra in Odisha.
"The strategic value of such a partnership with a major global player like CMA CGM is hugely significant and opens up a whole set of additional opportunities and synergies for both the companies,” said Gautam Adani, chairman of Adani Group.
This is the first port investment by CMA CGM Group in India and this new JV adds to the 27 container terminals that CMA CGM Group already has in its portfolio, and is a key step in its strategy to further expand its position in port operations.
With around 500 staff members and 24 offices, CMA CGM is calling nine ports in India, and offers to its Indian customers more than eight direct shipping services.
CMA CGM, founded and led by Jacques R. Saadé, is the world’s third-largest container shipping company and had a turnover of $15.9 billion as of 2013. Operating a fleet of 428 vessels, the Group serves more than 400 ports globally.
Originally incorporated as Gujarat Adani Port Ltd (GAPL) in 1998 to develop a private port at Mundra, on the west coast of India, the company commenced commercial operations in October 2001. Mundra Special Economic Zone Ltd (MSEZL) was incorporated in November 2003, to set up an SEZ at Mundra and was merged with GAPL in April 2006 and the company was renamed as Mundra Port and Special Economic Zone Ltd. Its name was changed again to Adani Ports & Special Economic Zone in January 2012.
Adani Ports’ scrip closed at Rs 275.15 a share, up 1.76 per cent on BSE in a strong Mumbai market on Friday. The company counts among its shareholders Temasek.
(Edited by Joby Puthuparampil Johnson)