Adani Ports Considering To Acquire Shapoorji Pallonji Group’s Gopalpur Ports In Odisha, Shares Zoom

Adani Ports and Special Economic Zone (APSEZ) shares traded 1.34% higher at Rs 1032.30 per share at 10:25 am IST on Thursday. Today, Adani Ports shares as well as shares of other Adani group firms grabbed attention after reports claimed that the company is holding talks with Shapoorji Pallonji Group to buy its Gopalpur Ports in Odisha for approximately Rs 1,100-1,200 crore in equity value.

One should note that on December 12, 2023, APSEZ will consider the proposal for the issuance of Non-Convertible Debentures and issuance/ renewal of Non-cumulative redeemable preference shares, on a private placement basis/ preferential basis, in one or more tranches. In an exchange filing on Wednesday, Adani Ports said, "The trading Window shall remain closed with effect from December 7, 2023, till 48 hours after the closure of the meeting to be held on 12th December 2023."

On December 6, the share price of Adani Ports traded at a new 52-week high value of 1082.95. The stock touched the upper circuit of Rs. 966.60 on December 5, 2023, and Adani Ports shares traded at a new 52-week high value of 1023.90 on the same day.

SP Ports Maintenance has a 56% stake in Gopalpur Ports, while the remaining stake is owned by Orissa Stevedores (OSL). This acquisition is part of the firm's string-of-pearls strategy that involves owning facilities in both eastern and western water margins.

The due diligence process is currently underway, reported Economic Times. As per the report, if the acquisition deal goes through, Gopalpur Ports will be APSEZ's sixth acquisition of a multi-purpose facility on the eastern coast.

However, it is yet not certain if any deal will emerge and materialize from the talks. Noticeably, another company JSW Infrastructure was in talks with the Mistrys for the same asset for Rs 3,000 crore enterprise valuation, said the report. The Mistry family was believed to not be happy with the offering.

According to a company presentation, reviewed by the financial daily, the SP Group had told investors the enterprise value of the port is $600-650 million (Rs 5,000 crore), with SP Group's equity value at $240-260 million (Rs 2,000 crore). According to credit rating firm Care Edge, the port has long-term bank facilities of Rs 1,432 crore, as of February 2023.

Earlier this week, SP Group offloaded a majority 50% stake in the 5 MTPA PNP Maritime Services (PNP Port). JSW Infrastructure paid Rs 270 crore in cash for the Raigad facility which has an enterprise value of roughly Rs 700 crore.

The group is expected to utilize the proceeds from these asset sales towards repaying the non-convertible debenture (NCD) holders of a Rs 14,300-crore, rupee-denominated zero coupon bond it had raised in July at an effective yield of 18.75%. It was among the most expensive borrowings of this magnitude in recent times by an Indian corporation.

These divestments are part of loan commitments, or "covenant terms," of the promoters of SP Group, the Mistry family, to lenders and debenture holders. As per the terms of the agreement, the Mistrys are committed to divesting these assets by March 31, 2024.

How Are other Adani shares performing today?

Most Adani stocks continued to trade higher for the fourth consecutive day on Thursday. In today's intraday trading session, the share price of Adani Enterprises was up 0.37%, Adani Green Energy was up 3.54%, Adani Total Gas was up 8.58%, and Adani Energy Solutions gained 2.69%. The recent rally in Adani group shares has propelled the Indian conglomerate's combined market capitalization to Rs 14.8 lakh crore.