DP World (NASDAQ Dubai: DPW) announced that it will repurchase P&O Ferries from Dubai World according to a DP World press release. The acquisition will be worth BGP (British pound sterling) 322 million or $421 million. (All values will be converted to U.S. dollars.)
DP World, based in Dubai, is a global port operator with a portfolio of 78 marine terminals in 40 countries. It’s owned by the government of the United Arab Emirates (UAE). P&O Ferries is a pan-European logistics business which manages 2.5 million tons of freight through its logistics arm, P&O Ferrymasters. According to Reuters, P&O Ferries has 21 vessels which connect the United Kingdom with Belgium, France, Ireland and the Netherlands. Dubai World is a Dubai-based investment company which manages UAE government assets, including DP World.
Reuters said that DP World acquired P&O Lines in 2006, but then sold P&O Ferries to Dubai World later that year. According to Gulf News, the current acquisition is part of DP World’s plan to expand its global footprint using investments in the international logistics industry. The acquisition is expected to be completed in the first half of 2019.
“We are pleased to announce the return of P&O Ferries back into the DP World family,” said Sultan Ahmed bin Sulayem, DP World group chairman and chief executive officer. “P&O Ferries is a strong, recognizable brand and adds a best-in-class integrated logistics provider into our global portfolio. Importantly, P&O Ferries provides efficient European freight connectivity building on last year’s acquisition of Unifeeder [see below]. This transaction is in line with our strategy to grow in complementary sectors, strengthen our product offering and play a wider role in the global supply chain as a trade enabler.”
P&O Ferries had revenue of $1.4 billion in 2017, carried over 10 million passengers and completed more than 30,000 voyages according to the company’s website.
“P&O Ferries has delivered a robust performance in recent years and we aim to drive further value through increasing efficiencies and offering value-added solutions to our customers,” said Sulayem. “Overall the transaction offers compelling value strategically and financially, and we look forward to P&O Ferries contributing to driving shareholder value in the coming years.”
The acquisition follows DP World’s acquisition of Unifeeder (a Denmark-based, containerized logistics solutions provider) in December 2018. DP World also acquired majority shares in DP World Australia from New York-based Gateway Infrastructure Investments in January 2019. That same month, DP World also agreed to buy a 71.3 percent stake in Santiago, Chile-based Puertos y Logistica, giving the company exposure to Latin American maritime terminals.