DP World set to exit Mundra port
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The Dubai government-owned DP World, the world's fourth largest port operator, is set to exit its container handling terminal at Adani-owned Mundra port — India's third-biggest container port after Jawaharlal Nehru port and Chennai port. DP World-run Mundra International Container Terminal (MICT) operates one of the two container handling facilities at the country's largest private port.
Sources said the exit would effectively bring to an end the bitter relationship between the Adani Group and DP World, which includes an extended court battle between the two players. It also terminates the lease early into the concession period spanning 99 years. When contacted, an Adani spokesperson said they had no comments to offer as the case was sub-judice.
Besides Mundra, DP World operates container berths at four other ports in the country — Nhava Sheva, Chennai, Vishakhapatnam and Kochi. The Mundra port has two operational container handling facilities —one run by DP World Pvt Ltd and the second by the Adani Group itself. These two terminals can together load up to 2.5 million standard containers a year.
Officials of the DP World had held discussions with the Adani Group about two months ago, for an out of court settlement. But an email sent to DP World elicited no response at the time of going to press. One of the contentious issues in the break up could be the terms to terminate the lease agreement.
In June 2003, the Adani Group sold the first container terminal at Mundra port to British port operator P&O Ports for $195 million. The Mundra terminal came into DP World's ownership after it acquired P&O Ports in February 2006. However, the Gujarat Maritime Board (GMB), the maritime regulator of Gujarat government, had termed the takeover as "illegal" as its permission was not sought.
Subsequently, through a notice issued on November 8, 2007, the Adani Group moved to terminate the contract with DP World and start discussions on transferring the assets. In December 2007, DP World resorted to legal recourse to prevent the Adani Group from terminating the contract.