MARG’s subsidiary - KPPL inks definitive agreements with Ascent

MARG, a leading infrastructure and real estate development company’s subsidiary Karaikal Port (KPPL) has finalized its fund raising plans for its Phase 24 Extension. KPPL had entered into definitive agreements with Ascent Capital Advisors India (Ascent) for an investment of up to Rs 200 crore to fund the development of KPPL. As per the terms of the definitive agreements, Ascent would invest Rs 200 crore in two tranches into KPPL by way of secondary purchase of promoter equity shares amounting to Rs 150 crore and by way of primary infusion of capital amounting to Rs 50 crore by subscribing to compulsorily convertible preference shares (CCPS). The deal values KPPL at Rs 1,330 crore on a pre-money basis.

Ascent has completed the first tranche of its investment by purchasing Rs 125 crore worth of equity shares of KPPL from Marg and by investing an amount of Rs 32 crore by subscribing to CCPS of KPPL. Karaikal Port had already attracted a private equity investment by India Infrastructure Fund into KPPL during March 2010 that with the present investment by Ascent, the port has two institutional investors adding value by their infrastructure exposure and expertise to augment and fuel the ambitious growth plans of Karaikal Port.

Karaikal Port is a deep-water port at Karaikal located on the Eastern coast of India in Karaikal District of Puclucherry Union Territory around 320 kilometers from the Chennai Port. The port, when fully developed, is envisaged to have a total of 9 berths capable of handling up to 47 MTPA. The port is to be developed over 3 phases with the final phase getting operational by 2016. Phase I of the Karaikal Port development, which is currently operational comprises of two berths - one each for coal and general cargo. Phase II currently under implementation involves a capex of Rs 1,570 crore. Phase 24 shall be operational by October 2011 and will take the capacity of the port to 21 MMTPA.

Project Phase 2A Extension is expected to further increase the cargo handling capacity of the port to 28 MMTPA and involves an additional capex of Rs 600 crore.

Marg has acquired the experience in various areas such as infrastructure comprising ports, power, dredging operations; industrial clusters encompassing special economic zones (SEZs), industrial townships and desalination plants; real estate commercial spaces including IT parks, malls, serviced apartments, convention centres and golf courses as well as real estate residential projects comprising high-end apartments, budget apartments, integrated townships, villas and beach houses.