Adani Ports and Special Economic Zone Ltd (APSEZ) has successfully sold its Myanmar port, Coastal International Terminals Pte Limited, for a sum of $30 million. The company’s Risk Committee recommended the exit from the project back in October 2021. The decision to sell the port was made in response to the military coup and subsequent crackdown on protests in Myanmar, which resulted in international condemnation and US sanctions.
The completion of the project faced several challenges and delays. The Share Purchase Agreement (SPA) included certain Condition Precedents (CPs), such as the project’s completion and necessary approvals for smooth business operations by the buyer. However, meeting these conditions proved difficult, leading to a renegotiation of the sale consideration. APSEZ conducted an independent valuation based on the project’s current state, resulting in a revised sale price of $30 million.
Initially, APSEZ aimed to conclude the exit between March and June 2022. However, due to the delays, the company renegotiated the sale price with the buyer, Solar Energy Ltd. The buyer will make the payment within three business days after fulfilling all compliance requirements. Once the total transaction value is received, APSEZ will transfer the equity to the buyer, finalizing its exit from the project.
APSEZ had invested $127 million in the Myanmar port project, including an upfront payment of $90 million for land leasing, as per filings from May 2021. The input from minority shareholders played a significant role in the company’s decision to exit the project. Adani Ports reiterated its stance of not engaging with sanctioned entities, which further influenced the decision to sell the port.
Overall, APSEZ has successfully completed the sale of its Myanmar port, emphasizing its commitment to adhering to international standards and avoiding involvement with sanctioned entities.
