Dubai’s DP World plans IPO for its new Indian unitby Paromita Dey on Mar 13, 2016
Dubai-based port operator DP World Ltd plans to sell shares through an initial public offering (IPO) and list its new Indian holding company, Hindustan Ports Pvt. Ltd (HPPL), according to a report.
The development comes after the Union cabinet of India said it had “no objection” to the proposed change in shareholding in the container terminals run by the Dubai government-owned company in India.
DP World has invested about $1.2bn and is currently the biggest foreign port operator in India—running six port terminals spread across Mundra, Jawaharlal Nehru Port (two facilities), Cochin, Chennai and Visakhapatnam.
These six terminals have a combined market share of about 30% of the 10.7 million twenty foot equivalent units (TEUs) handled by Indian ports during 2014-15. A TEU is the standard size of a container and a common measure of capacity in the container business.
“When all the six entities, which are currently run by separate special purpose vehicles come under HPPL, it will go for an IPO,” said a Mumbai-based banker requesting anonymity. “That’s the plan,” the banker said, without giving a time frame or details of the share sale.
DP World said it had no comment to offer on the cabinet decision, on the planned restructuring of its Indian assets, or on the share sale.
Through Hindustan Ports, DP World is seeking to restructure its assets in India with the objective of consolidating the ownership of its port infrastructure into a single holding company, reported online portal dealstreetasia.
The new holding company will take over all liabilities of the existing subsidiaries of DP World in relation to the concession agreements it signed with port authorities for these six terminals.