Aegis Logistics Limited (ALL) has made a significant move in its business operations by finalizing an agreement to transfer its Liquefied Petroleum Gas (LPG) terminal to Aegis Vopak Terminals Limited (AVTL), its associate company. The deal, valued at ₹428.40 crore, marks a strategic restructuring within the Aegis group of companies.

Transaction Details

Aegis Logistics has transferred its newly commissioned LPG cryogenic terminal at Pipavav to Aegis Vopak Terminals Limited for ₹428.40 crore in cash. The Business Transfer Agreement (BTA) was executed on July 10, following the recent commissioning of the LPG terminal on July 3. The transaction involves the transfer of a cryogenic static storage facility with a capacity of 48,000 MT located at Pipavav. This transfer will be carried out as a slump sale on a going concern basis.

Strategic Rationale

The move is aimed at leveraging growing service demand and achieving operational synergy within the group. AVTL, which already manages LPG terminalling services at Pipavav port, will now own this additional capacity, potentially enhancing its operational efficiency and market position. The transaction aims to consolidate LPG terminalling services under AVTL.

Financial Implications

While the exact financial impact is yet to be determined due to the recent commissioning of the terminal, the transaction value of ₹428.40 crore underscores the significance of this asset transfer. As per the company's disclosure, the LPG terminal had not contributed to the turnover or net worth as of March 31, given its recent operational status.

Regulatory Compliance

Aegis Logistics has confirmed that the transaction is a related party transaction conducted on an arm's length basis. The company has also clarified that the sale falls outside the Scheme of Arrangement and does not trigger the provisions of Regulation 37A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, as the LPG storage terminal does not meet the definition of an "undertaking" under these regulations.

Company Profiles

Aegis Logistics Limited (ALL)

Specializes in developing, owning, and operating shore-based tank farm installations in India, providing logistics solutions for oil, gas, chemicals, and petrochemical industries.

Aegis Vopak Terminals Limited (AVTL)

Focuses on operating and managing independent storage and handling facilities, including storage terminals and pipelines connected to vessel jetties for various products such as chemicals, oils, petroleum products, LPG, and other gases.

This strategic move by Aegis Logistics reflects the company's efforts to optimize its asset portfolio and strengthen its position in the LPG storage and handling sector. The transaction is expected to be completed on the same day as the agreement execution, July 10, marking a swift transition of the asset to AVTL's management.

Aegis Logistics , a leading player in the Indian oil and gas industry, has taken a significant step to enhance its operational capabilities. The company has announced the launch of a new Liquefied Petroleum Gas (LPG) cryogenic terminal in Pipavav, marking a notable expansion in its infrastructure.

Terminal Specifications

The newly launched terminal boasts impressive specifications:

• Location: Pipavav
• Type: LPG Cryogenic Terminal
• Storage Capacity: 48,000.00 Metric Tonnes (MT)

This state-of-the-art facility underscores Aegis Logistics' commitment to strengthening its position in the LPG market and improving its ability to meet the growing demand for clean energy solutions.

Strategic Importance

The addition of this high-capacity LPG terminal is likely to bolster Aegis Logistics' operational efficiency and storage capabilities. Pipavav, being a strategic port location, could potentially offer the company improved access to both domestic and international markets.

Industry Implications

This expansion comes at a time when India is pushing for increased LPG adoption as a cleaner cooking fuel alternative. The new terminal's substantial storage capacity of 48,000.00 MT could play a crucial role in ensuring a steady supply of LPG, contributing to the nation's energy security and supporting the transition to cleaner fuels.

As Aegis Logistics continues to invest in its infrastructure, this move signals the company's proactive approach to capitalizing on the growing LPG market and reinforcing its position as a key player in the sector.