Indian state objects to MSC’s US$1.4 billion deal with Adani Ports

[KERALA] An Indian state is objecting to a planned US$1.4 billion investment in an Adani Group-run terminal by Mediterranean Shipping (MSC), intensifying scrutiny of the Swiss company after a chemical spill last year involving one of its vessels.

The deal – which would give MSC 49 per cent of the Adani Ports and Special Economic Zone-operated Vizhinjam Port – was announced without prior consultation, V D Satheesan, the chief minister of the southern Indian state of Kerala, said in a post on X on Thursday (Jul 2).

Under the terms of the deal announced on Jun 30, MSC’s terminal arm – Terminal Investment – will invest US$539 million upfront in Adani Vizhinjam Port, followed by US$858 million once the port’s expansion is completed by December 2028.

Vizhinjam is one of India’s most ambitious port projects. It is a deepwater transhipment hub near the country’s southern tip that is being expanded to 5.7 million 6.1 m equivalent units (TEUs) from 1.6 million TEUs.

The upgrade is designed to attract the world’s largest container ships and win traffic from regional hubs such as Colombo, Dubai and Singapore.

Any change in the project’s ownership structure needs government approval and will be reviewed closely, Satheesan said.

A representative of Adani Group declined to comment. 

Adani Ports fell as much as 1 per cent on Friday, heading for its first daily decline after gaining about 4 per cent over the previous three days.

The pushback comes as MSC faces investigations into a May incident in which one of its vessels capsized and spilled cargo and fuel off the Kerala coast.

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Adani Ports to sell 49% stake in Indian port to Swiss shipping giant MSC for US$1.4 billion

The Liberia-flagged ship was carrying more than 640 containers, including 13 loaded with hazardous calcium carbide, when it went down about 13 to 14 nautical miles from the shore while sailing from Vizhinjam to Kochi. BLOOMBERG