Adani Ports emerges top contender for Karanja Terminal takeover

Adani Ports and Special Economic Zone has emerged as the frontrunner to acquire embattled Karanja Terminal & Logistics after creditors backed its Rs 625-crore recovery plan, people familiar with the matter said.

The largest commercial port operator in the country proposed a full recovery for financial creditors regarding their dues of Rs 625 crore, they said.

ET had reported in November that distressed debt aggregator Prudent ARC had acquired nearly the entire debt of Karanja from a Canara Bank-led consortium, including Bank of Baroda and Punjab & Sind Bank, for Rs 520 crore, outbidding the promoter’s Rs 475-crore offer.


“Prudent continued the insolvency and bankruptcy process, which was started by Canara and had called for bids. Dickey Alternative Asset Management was the other bidder. Adani’s bid was preferred because it also gave something more for operational creditors and employees, besides offering full dues for creditors,” said a person cited earlier.

ET could not ascertain the details of the Adani plan.

Prudent, Adani and the resolution professional, Bimal Kumar Agarwal, did not respond to ET’s request for comment.

The person cited earlier said Prudent has sought approval of the National Company Law Tribunal (NCLT) for Adani’s plan. If cleared, the deal could mean a Rs 105-crore upside for Prudent or a 20% upside on its investment after it bought the debt.

“The promoters of the company have also filed a petition in the NCLT seeking the opportunity to make another offer under Section 12A. That petition is listed for hearing in the first week of July,” said another executive. “NCLT will only take up the Adani offer after completing this hearing.”

Section 12A of the Insolvency and Bankruptcy Code (IBC) allows for withdrawal of an admitted corporate insolvency by allowing promoters to settle their debt, provided they obtain approval from 90% of the creditors.

In February, the NCLT’s appellate tribunal had rejected Karanja promoters’ objection to the insolvency proceedings because it had offered to settle dues with lenders.

“The court will hear the promoters, but it is difficult for it to allow for a settlement at such a late stage, because under the new IBC amendments enforced earlier this year, the window for any offer from the promoters closes after the resolution professional issues the first invitation for submission of resolution plans or Form G,” said the executive.

For Adani, the acquisition of Karanja would mean an additional port on the west coast. It already has ports across Gujarat, Maharashtra, Goa and Kerala. The company has a presence across 15 domestic ports in seven maritime states.