Adani proposes Rs 16,744 crore investment in Vizhinjam Port expansion

THIRUVANANTHAPURAM: Adani Ports and Special Economic Zone Ltd. (APSEZ) has proposed an investment of Rs 16,744 crore ($1.75 billion) to expand the Vizhinjam International Seaport, subject to the Kerala government's approval of a strategic stake sale to the Mediterranean Shipping Company (MSC). As part of the proposal, Adani plans to sell a 49% stake in Adani Vizhinjam Port Pvt. Ltd. to Mundi Ltd., a subsidiary of Terminal Investment Ltd. (TiL), the terminal operating arm of MSC. The company said it will retain a 51% controlling stake and will not proceed with the equity transfer without the state's approval.

The proposed expansion would raise the port's annual container handling capacity from 1.6 million TEUs to 5.7 million TEUs. According to Adani, the partnership is expected to bring a significant share of MSC's transshipment traffic from Colombo to Vizhinjam while also attracting cargo from East Africa and Bangladesh.

The company said the port would continue to function as a common-user facility, similar to the arrangements at its Ennore and Mundra ports, and that MSC or its subsidiaries would not receive any exclusive operating rights. Adani has also submitted details of the proposed transaction, including information on the entities involved, the scale of the investment and its plans for the port's future expansion.

Government forms review panel

The Kerala government has set up a high-level committee, headed by the Chief Secretary, to examine the proposal before taking a decision.

Port Secretary Dr. Rathan U. Kelkar said the committee would assess the transaction from the perspectives of national security, public interest, fair competition and the state's long-term interests. He added that the government aims to develop Vizhinjam as a globally competitive transshipment hub while ensuring it remains a neutral port open to all shipping lines.