APM Terminals said it’s acquiring 37.5 percent of the public company Global Ports for $862.5 million, thereby entering the Russian market in a strategic partnership with the leading Russian transportation group, N-Trans.
By buying the stake in Global Ports, APMT becomes an equal controlling partner in the leading operator of container terminals in Russia. Until now, N-Trans has been the sole controlling shareholder of Global Ports with 75 percent ownership. Twenty-five percent of Global Ports is free floating.
APMT said the acquisition values Global Ports at about $2.3 billion, making APMT’s share acquisition the largest foreign direct investment in Russia’s transportation industry to date.
With the investment, APMT adds holdings in:
- Three container terminals in Russia. (They are in the “big port” of St. Petersburg; “Moby Dik” container terminal on Kotlin (Kronstadt), outside St. Petersburg; and Port Vostochny on Russia’s Pacific Coast.
- Two container terminals in Finland – in Helsinki and Kotka.
- The Yanino inland container depot near St. Petersburg.
- The major Vopak oil and oil products terminal in Muuga, Estonia.
Global Ports’ annual report said in 2011 container traffic accounted for 71 percent of the company’s revenue and oil products 29 percent.
The company’s Russian operations handled 1,344,500 TEUs in 2011, 44 percent more than the prior year. The Finnish terminals handled 162,700 TEUs in 2011, a 2 percent increase over 2010.
APMT said it “will also be able to play a major role in expanding terminal capacity for future demand in Russia and neighboring countries when the right opportunities present themselves.”
“Russia will need world-class port infrastructure and operational excellence to serve global shipping lines and its own ambition of economic development,” said Kim Fejfer, chief executive officer of APMT. “Today we are proud to announce that we found an excellent partner to expand our network to Russia. Global Ports has a well-diversified port network, a very experienced management team, a sound customer-focus, and a good eye to grow the business.”
He said he believes the investment will offer value to APMT’s shipping customers immediately and create further opportunities to accommodate their growth in the future. The Russian market showed impressive growth rates in the past with an average growth over 15 percent a year in the past five years, Fejfer added.
“The rapidly developing middle class, Russia’s integration with the global economy as evidenced by the recent WTO membership and the country’s wealth of natural resources will continue to fuel the growth in exports and imports in the long run,” the company said.
Global Ports reported revenues of $501 million and an adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) of $282 million in 2011. It has been listed on the London Stock Exchange since 2011.
Completion of the transaction is expected to occur by the end of the year. – Chris Dupin
