PSA International has purchased Hong Kong-based Luck Glory International Ltd., which owns a 15.33 percent share of China United International Rail Containers, for an undisclosed price, the company said in a statement.
Global port operator PSA International, known as the Port of Singapore Authority until its privatization in 1997, has acquired a minority stake in China United International Rail Containers Co., Ltd (CUIRC), the country’s largest inland railway container terminal network, PSA said in a statement.
Established in 2007 and headquartered in Beijing, CUIRC is a Sino-foreign joint venture mandated by the Chinese government to develop and operate 18 rail container terminals in strategic locations across the country. Ten terminals are already in operation in Kunming, Chongqing, Chengdu, Zhengzhou, Wuhan, Xi’an, Dalian, Qingdao, Ningbo and Tianjin.
The equity investment by PSA was accomplished through the purchase of Hong Kong-based Luck Glory International Ltd., which owns a 15.33 percent stake in CUIRC.
Financial terms of the deal were not disclosed.
The deal is PSA’s first foray into the railway container terminal business in China. The port group currently operates a network of 11 coastal container terminals in China at the ports of Dalian, Fuzhou, Guangzhou, Tianjin, Dongguan, Lianyungang and Guangxi Beibuwan (Qinzhou).
The company noted that China’s railway container sector currently only handles between 2 percent and 3 percent of the country’s containerized ocean volumes. By comparison, rail markets in Europe and the United States transport anywhere from 15 percent to 40 percent of overall container volumes, meaning there is significant potential for intermodal container cargo growth on the rails.
PSA International Group CEO Tan Chong Meng called the CUIRC investment a “game changer,” adding that the move fits well into the company’s overall strategy in China.
“With our current presence in major China gateway ports, PSA is well-positioned to develop synergies with CUIRC to grow integrated sea-rail intermodal operations across the world’s second largest economy,” said Tan. “I am confident that we will be able to forge strategic relationships with our partners, leveraging our complementary strengths to make the collaboration a success.”
In addition to PSA, joint venture partners in CUIRC include China Railway Container Transport Corp. Ltd, NWS Holdings Limited, China International Marine Containers (Group) Ltd, and Deutsche Bahn Mobility Logistics AG.
PSA acquires minority stake in Chinese inland rail container network
