Kannur: Leader of the Opposition Pinarayi Vijayan has moved India's market regulator, the Securities and Exchange Board of India (SEBI), against Adani Ports and Special Economic Zone Ltd's proposed sale of a 49% stake in the Vizhinjam Port Pvt Ltd to a subsidiary of Switzerland-based Mediterranean Shipping Company (MSC), the world's largest container shipping line.

In a letter sent on Friday, Vijayan urged SEBI to initiate action against Adani Ports, alleging that it failed to disclose that the transaction lacked the Kerala government's mandatory prior approval under the concession agreement, a safeguard intended to "protect national security and public interest".

Vijayan sent a similar letter to the National Stock Exchange (NSE), where Adani Ports and Special Economic Zone Ltd is listed.

On June 29, Adani Ports informed SEBI that it had entered into a definitive agreement to sell a 49% stake in its subsidiary, Adani Vizhinjam Port Pvt Ltd (AVPPL), to Terminal Investment Limited (TiL), the port-operating arm of MSC Group.

The proposed deal became public on June 30, triggering a political storm in Kerala. When the Leader of the Opposition raised the issue in the Legislative Assembly on July 1, Chief Minister V D Satheesan said the state government had neither received any request for prior approval nor any intimation from Adani about the proposed transaction, and had learnt of it only through media reports.

On Saturday, Vijayan addressed a press conference in Pinarayi, Kannur, and questioned how the Adani Group had "got the courage" to proceed with the sale without the state's mandatory prior approval. The answer to that would reveal the "underlying facts" behind the deal, he said when asked whether he suspected any collusion between the UDF government and the Adani Group.

He did not hide who he was targeting. "A proposal of this nature has to be examined administratively by the Ports Department, legally by the Law Department, and financially by the Finance Department. In Kerala, all three are handled by a single person: the Chief Minister. That is precisely where the serious suspicion arises," he said.

Vijayan said people could not be faulted for suspecting collusion between the government and the Adani Group if the matter remained unexplained. Congress leader Rahul Gandhi had consistently taken a strong stand, both inside and outside Parliament, against what he described as the "Adani-Modi partnership".

Congress general secretary K C Venugopal also had said the Adani Group enjoyed a free hand in BJP-ruled states. Kerala, according to Venugopal, is not such a state, Vijayan said.

"But the question now is: why is the Adani Group receiving the same kind of treatment in Kerala? Without saying so in as many words, the Congress leadership has conveyed that the Adani Group appears to be receiving the same extraordinary concessions in Kerala that it enjoys in BJP-ruled states," Vijayan said, also alleging that despite coming to know of the deal through the media, the state government had done nothing to block the deal. 

​He said that as soon as the deal came to the government's notice, it should have sought legal opinion, placed the records before SEBI and moved to block the transaction. "But none of this has been done. On July 3, the Chief Minister's Office released a statement on the issue, but it was silent on what action the government would take to oppose the deal," Vijayan said.

He said Adani Group's omission of the fact that it did not have the state government's prior approval was not "a mere technicality". He said he had told SEBI and the NSE that Adani's June 29 disclosure was "materially incomplete" because it violated Clause 5.3 of the 2015 concession agreement, which required the company to obtain the Kerala government's prior approval before any stake sale exceeding 25%.

The concession agreement states that any transfer of 25% or more of the equity in the concessionaire constitutes a "change in ownership", requiring the Kerala government's prior approval from the standpoint of national security and public interest. The proposed transfer of a 49% stake clearly crosses that threshold, he said.

"The consent of the government is not a routine regulatory formality. It is an indispensable condition precedent for completing the transaction," the letter says.

He asked SEBI to seek an explanation from Adani Ports, direct it to clarify the government's position under Regulation 30 (11) of the Listing Obligations and Disclosure Requirements (LODR) Regulations, and initiate proceedings if violations are established.

Vijayan also expressed surprise that Adani Ports had not withdrawn its SEBI intimation of June 29, despite the Kerala government publicly stating that it had not been informed of the transaction.

Vijayan also reiterated his opposition to the proposed induction of Mediterranean Shipping Company (MSC) into Vizhinjam Port, arguing that allowing the world's largest container shipping line to acquire a substantial stake could undermine the port's long-term competitiveness. Vizhinjam's growth depended on attracting multiple global shipping companies, each potentially operating dedicated terminals. If MSC secured a dominant position, it would naturally prioritise its own commercial interests over those of rival shipping lines, reducing the port's attractiveness as a common-user facility, he said.