Indian billionaire Gautam Adani, the founder of a coal mining, ports and power conglomerate, bought a port in the east-coast state of Odisha, increasing his capacity in a resource-rich region of the nation.
Adani Ports & Special Economic Zone Ltd. acquired Dhamra Port Company Ltd. for an enterprise value of 55 billion rupees ($932 million) from Tata Steel Ltd. and a unit of Larsen & Toubro Ltd., the companies said in a statement today.
Adani currently owns and operates five ports in India, with only one of them, at Visakhapatnam, on the east coast. Its annual capacity is 5 million tons. Dhamra, by comparison, has a capacity of 25 million tons, and Adani Ports today said it will increase that to 100 million tons by 2020.
“This is the first major port for the company on the east coast and is a very good fit in its portfolio,” said Vibhor Singhal, an analyst at Phillip Securities in Mumbai said by phone. “This will help Adani Ports get a slice of iron ore, steel and later coal cargoes coming in from eastern routes.”
Dhamra, an equal joint venture between Tata Steel and L&T Infrastructure Development Projects Ltd., was commissioned in May 2011, Tata Steel said.
The purchase may allow Tata Steel to reduce its net debt, which is 673.3 billion rupees, according to company data.
Adani’s net worth has quadrupled to $7.6 billion from $1.9 billion on Sept. 13, when Narendra Modi, the chief minister of India’s western state of Gujarat, was named prime ministerial candidate of the Bharatiya Janata Party, according to the Bloomberg Billionaires Index. Modi today led the BJP to India’s biggest national electoral victory in 30 years.
Adani, 51, runs Gujarat’s biggest port.