In a long-term growth-centric move, DP World has divested a 22.5% stake in its wholly-owned Indian terminal holding company, known as Hindustan Ports Pvt. Ltd. (HPPL), to the National Investment & Infrastructure Fund (NIIF), a domestic, public investment platform engaged in long-term infrastructure financing.
DP World, via its local subsidiary Hindustan Infralog Pvt. Ltd. (HIPL), joined NIIF in 2018 to explore new growth opportunities in India, targeting investment worth US$3 billion.
The latest transaction involves a US$300 million investment and takes NIIF’s investment under the joint funding programme thus far to US$500 million.
“As the value chain becomes more integrated, significant growth opportunities exist across the entire Indian ports and logistics space and both HIPL and HPPL are suitably placed to capture these opportunities,” a joint statement said. “The primary capital raised through this transaction will aid in new infrastructure development, drive supply chain efficiencies and support future growth initiatives of HPPL. The investment in this combined entity will improve cargo connectivity which will deliver cost efficiencies and an enhanced customer experience.”
The Dubai-based company operates a network of five container terminals in India with a combined capacity of about 5 million TEU annually, spanning four major port locations and accounting for some 20% of Indian containerised traffic. The concessions include two facilities in Nhava Sheva Port, near Mumbai, as well as one terminal each in the ports of Mundra, Chennai and Cochin.
“This investment from NIIF Master Fund extends the existing DP World and NIIF partnership, formed through the creation of Hindustan Infralog Private Limited (HIPL) in 2018. Since its inception, HIPL has made substantial investments in rail logistics, multi-modal logistics parks, container freight stations, economic zones, cold chain infrastructure and contract logistics to create a market leading integrated logistics platform,” the statement noted.
Sultan Ahmed Bin Sulayem, group chairman & CEO of DP World, commented, “The broadening of our partnership with NIIF to include our flagship India ports platform is a natural extension of our existing relationship and aligns both parties to focus on delivering end-to-end supply chain solutions. Since the beginning of this partnership with NIIF, we have made significant progress in building an inland logistics infrastructure network of great scale that complements our container ports platform.
Notably, the opportunity landscape in India remains significant and this transaction will allow us to accelerate investment across ports and logistics to drive returns for our respective stakeholders.”
As part of its container integrator strategy, DP World has also significantly expanded its landside reach in India, acquiring a bevy of container storage yards in recent years. It purchased the depot network of Continental Warehousing Corporation (Nhava Sheva) Ltd. (CWCNSL) in May 2018 and also took over Kribhco Infrastructure Ltd. (KRIL), owning two multimodal logistics entities, a year later.
According to data collected by Container News, DP World terminals across four port locations in India together handled approximately 395,000 TEU in May, out of a total 1.67 million TEU shipped in and out of the country last month.
Jenny Daniel
India correspondent
Contact email: j.daniel@container-news.com
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