In a major expansion for Adani Group's ports arm Adani Ports and Special Economic Zone Limited (APSEZ) in Israel, the company, jointly with Israel's Gadot Group, has won a tender to privatise Haifa port—second largest port in Israel.
After a global competitive bidding process, the Adani-Gadot consortium emerged as the winning bidder and secured the rights to buy 100 per cent shares of Haifa Port Company Ltd (HPC) with a concession period up to 2054, an APSEZ statement said on Friday.
The consortium of APSEZ and Gadot Group was formed with their respective shares of 70 per cent and 30 per cent.
The consortium’s offer was NIS 4.1 billion, equivalent to $1.18 billion.
The acquisition will enable APSEZ to expand its footprint into the European port sector, which includes the lucrative Mediterranean region.
"This win is strategic for us from several dimensions. It gives us a much larger presence in Israel, one of India’s most strategic partners. Adani Group has been working with them for six long years to build a network of relationships across several industries," said Karan Adani, Wholetime Director & CEO, APSEZ.
"In the short-term, we look forward to developing strategic trade lanes between our ports in India and Haifa and help facilitate trade between the two countries," he said adding that it will diversify the port cargo as well as leveraging APSEZ's expertise to increase the operational efficiencies.
APSEZ's portion of investment is being funded through internal accruals.
"We anticipate Israel becoming a connection both for Europe and the Middle East, and therefore we stand to be benefit from the new possible trade lanes that will get created," Adani said.
On the partnership, Opher Linchevski, CEO of Gadot said, "The length of the lease and the growth that we anticipate in the Israel economy as well as the surrounding regions means we are well positioned to build one of the best ports in this region."
Located in the northern part of the country, the Haifa Port handles nearly half of Israel’s container cargo and is the country’s principal port for passenger traffic and cruise ships.
It is closer to the city of Haifa and about 90 kilometers from Tel Aviv, the key commercial city of Israel. It is also one of the major industrial areas of the country.
HPC also has real estate available for the development of office spaces, hotels, tourism and other recreational activities. The existing infrastructure at Haifa port includes two container terminals and two multi-cargo terminals.
The total developed quay length measures more than 2,900 metres. The maximum draft available ranges from 11 metres to 16.5 metres.
Haifa port has a Roll-on Roll-off (RORO), a cruise terminal with various passenger facilities and a waterfront length of two km for development. During 2021, HPC handled 1.46 million TEUs of containers, 2.56 million tons of general and bulk cargo.