Singapore's PSA, operator of the world's largest trans-shipment hub, has won a deal in partnership with an Indian firm to build a $46 million container terminal at Kandla, India's second-busiest port, officials said on Wednesday. A unit of PSA, which is owned by Singapore state agency Temasek Holdings Pte. Ltd, will team up with India's ABG Heavy Industries Ltd to develop and run the terminal for 30 years on a build-operate-transfer (BOT) basis.
"The board of trustees cleared ABG's proposal last week. Now it needs to be approved by the federal shipping ministry," R.T. Revankar, traffic manager at the west coast port, told Reuters.
ABG will have to form a special purpose vehicle with Voltri Terminals Europa Spa., a fully owned unit of PSA International Pte Ltd, before it can formally sign an agreement with Kandla port, he said.
The Indian firm, which specialises in long-term deployment of container handling systems, has a management agreement with Voltri which runs a terminal at Genoa in Italy.
"We are still negotiating with PSA about the holding structure for the new company. We are keen to retain a majority stake," a senior ABG official said.
"We hope to sign the agreement with Kandla port early in August and conclude partnership details with PSA before that."
ABG emerged as the highest bidder by offering nearly 49 percent share of gross revenue to Kandla port, 15 percent more than AFCONS Infrastructure Ltd and ULA Consortium, the second highest bidder.
Gammon India Ltd, the third bidder quoted a distant 17 percent.
The new container terminal will have a draught of 12.5 metres (41 ft) and quay length of 545 metres and a capacity to handle 500,000 twenty-foot equivalent unit (TEUs) when fully operational.
PSA already operates the Tuticorin Container Terminal in southern India and its parent company, Temasek, bought a 10 percent stake in Indian-Singapore logistics group Gateway Distriparks Ltd last year.
Kandla, favoured by traders of agricultural commodities and chemicals, handles more than 40 million tonnes of cargo annually.
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