Vizhinjam port stake sale needs state nod: Govt

T’puram: Govt said on Wednesday that Adani group cannot proceed with any change in ownership of Vizhinjam International Seaport project without the state’s prior approval and it had not received a proposal seeking such a permission.

Replying to a submission by opposition leader Pinarayi Vijayan in the assembly, CM V D Satheesan said the govt came to know about the proposed stake sale through media reports. “Adani Ports has not sent any communication or information to the govt. No proposal has come before us. When it comes, we will examine it,” he said.Referring to the concession agreement governing the project, he said clause 5.3 clearly states: “The concessionaire shall not undertake or permit any change in ownership, except with the prior approval of the authority.”

He said the authority in this agreement is the Govt of Kerala and therefore no change in ownership can take place without its prior approval.Satheesan said there is a distinction between the provisions of the Companies Act and the concession agreement. While the former treats transfer of over 75% of the shares as a change in ownership, the concession agreement states that a transfer of 25% or more of the shares amounts to a change in ownership.

The CM said Vijayan’s concerns would be examined in detail before govt takes a decision. He said national security would be the foremost consideration as Vizhinjam is a strategically important port. Also, clearances from the ministry of home affairs and the ministry of shipping are required for the deal. Satheesan said public interest would be another key consideration. He said govt would ensure that the port continues to function as a common user facility and does not become the monopoly of a single company.The CM said the proposed investor is not just a financial investor but the world’s largest container shipping company and the govt would have to examine how it proposes to utilize the port.He said UDF govt would evaluate the proposal on five key parameters. These include national security, public interest, ensuring that the port remains a common user facility, fair competition, promotion of investment by all companies and the long-term development of Vizhinjam port.

He added that govt would also examine activities outside the port as part of its long-term development strategy and safeguard Kerala’s revenue interests.

“After examining these aspects will the govt consider granting approval,” said Satheesan.His response came in the backdrop of reports that Adani group plans to transfer a 49% stake in Adani Vizhinjam Port Pvt Ltd to Switzerland-based Mediterranean Shipping Company. The proposed transaction is valued at Rs 13,270 crore.