Thursday, August 28, 2008

3i to invest Rs1,000 crore in port firm (CVR Group)

Hyderabad: Global private equity firm 3i Group may invest Rs 800 -1,000 crore for a 15-26 percent stake in Krishnapatnam Port, the developer and operator of an all-weather, deep-water port in Andhra Pradesh. It is considered the biggest investment by a foreign private equity firm in India’s port sector.

The UK-based firm has filed for approval with the Foreign Investment Promotion Board (FIPB), the agency that clears overseas investments into India, said Chinta Visweswar Rao, Chairman of Hyderabad-based CVR Group, which controls Krishnapatnam Port.

The company has not yet signed an agreement with 3i Group, though the usual practice of firms is to tie up partnerships with foreign investors before seeking FIPB approval.

"We preferred to sign the agreement only after the foreign investor obtained clearance from FIPB," Rao said.

Krishnapatnam Port Co. was formed by CVR Group to develop and operate a Rs10,000 crore, 100 million tonnes (mt) a year capacity port on the country’s eastern coast, at Krishnapatnam in Andhra Pradesh’s Nellore district.

Krishnapatnam port is being developed in three phases. The port, the deepest in the country with a depth of 15.6m, has around 6,000 acres of so-called custom bonded area, or space where goods can be stored.
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