3i invests $161m in Indian port company

The third investment from 3i's $1.2bn infrastructure fund will help the Krishnapatnam Port Company further develop and run the Andhra Pradesh-based port, which is expected to handle about 100 million tonnes of bulk cargo when fully completed.

Global private equity firm 3i has invested $161 million for a minority stake in the Krishnapatnam Port Company.

The funding will help the company further develop, operate and maintain its port, which is expected to handle about 100 million tonnes of bulk cargo when fully completed.

Krishnapatnam Port

The company has been awarded a 30-year concession from the government of Andhra Pradesh, to develop, manage and maintain the Krishnapatnam port, a natural, deep water, all-weather port in the state. “The port was inaugurated in July 2008, when the first phase of its building was completed. It is being built in three phases,” said a 3i spokesman.

This is 3i India Infrastructure Fund’s third investment. The fund had previously invested $227 million in Adani Power, which is developing a portfolio of power plants across India, and $101 million in infrastructure developer Soma Enterprise. The fund closed on $1.2 billion in March 2008.

Traffic at Indian ports is projected to grow from 700 million tonnes in 2007 to 1225 million tonnes by 2014, according to India’s Planning Commission. It estimates that the port sector needs approximately $20 billion in investment over the next five years.