MSC’s Strategic Acquisition of Adani Ennore Container Terminal
MSC Mediterranean Shipping Company, a major player in the global shipping industry, is making significant strides in expanding its terminal operations on the east coast of India. This strategic move is facilitated through its subsidiary, Terminal Investment Ltd. (TIL). The acquisition involves a substantial stake in the Adani Ennore Container Terminal, a growing facility situated about 20 miles north of Chennai. The deal, valued at around $145 million, entails MSC’s subsidiary acquiring a 49 percent stake in the terminal from India’s private port operator, Adani Ports and Special Economic Zone.
The Ennore Container Terminal is a state-of-the-art facility on the Bay of Bengal, boasting an annual handling capacity of approximately 800,000 TEUs (Twenty-Foot Equivalent Units). In the first eight months of the fiscal year 2024, the terminal has already processed 450,000 TEUs, signaling growth compared to the total of 550,000 TEUs for the entire previous fiscal year. Adani Ports retains a 51 percent ownership stake in the terminal post-transaction, as the closing is anticipated in the first quarter of 2024. Adani holds a concession for the terminal until 2044.
The partnership between Adani Ports and MSC aims to further develop and expand operations at the Ennore Container Terminal. The terminal is strategically located, providing congestion-free access to major highways and roads, coupled with an efficient intermodal connection to the rail system. Adani Ports envisions increasing the terminal’s capacity to handle 1.4 million TEUs annually, a significant expansion from its current capabilities.
TIL was started in 2000 by the Aponte family to secure container terminal capacity in the major ports serviced by MSC, the majority owner and main client of the company. The company now has operations at more than 70 terminals in 31 countries. It operates terminals ranging from Long Beach, California to Antwerp and Le Harve, as well as Saudi Arabia and Singapore. MSC is also currently in process on a deal to invest in the operator of the terminals in Hamburg, Germany taking a 49 percent stake and managing the company with the City of Hamburg.
This investment follows MSC’s involvement with Adani in the CT3 Container Terminal at Mundra Port in 2013. Mundra Port, situated in northwest India, serves as the largest private commercial port in the country. MSC’s collaboration with Adani in Mundra has proven successful, with the port becoming a crucial hub for transshipments. The terminal achieved a milestone last month, surpassing 300,000 TEUs in monthly volume, marking its highest-ever monthly performance.
Terminal Investment Ltd. (TIL), established in 2000 by the Aponte family, plays a pivotal role in MSC’s expansion strategy. TIL was founded with the objective of securing container terminal capacity in major ports serviced by MSC, the company’s majority owner and primary client. With operations spanning across more than 70 terminals in 31 countries, TIL has a global presence, managing terminals from Long Beach, California, to Antwerp and Le Havre, as well as locations in Saudi Arabia and Singapore. MSC is also in the process of finalizing a deal to invest in the operator of terminals in Hamburg, Germany, acquiring a 49 percent stake and assuming management responsibilities in collaboration with the City of Hamburg.
MSC’s aggressive expansion extends beyond terminal operations to encompass various aspects of its business, including shoreside activities. The company recognizes the critical importance of securing increasingly limited terminal capacity for the growth and development of its core container shipping business.
In summary, MSC’s strategic investment in the Adani Ennore Container Terminal aligns with its broader vision for expanding operations in India. The collaboration with Adani Ports positions MSC to leverage the terminal’s capabilities and geographical advantages, further solidifying its foothold in the dynamic and growing market of the Indian subcontinent. As the global shipping landscape evolves, MSC’s proactive approach to securing terminal capacity reflects its commitment to sustaining and enhancing its core business.