Dubai: DP World, one of the world’s largest port operators, has agreed to acquire Fairview Container Terminal in Canada for 580 million Canadian dollars ($457 million, Dh1.69 billion) from Deutsche Bank, the company said on Thursday.
The terminal is located on the country’s west coast in Prince Rupert, British Columbia, and has a capacity of 850,000 twenty-foot equivalent units (TEUs)- a shipping container measurement. It was recently announced capacity would be increased to 1.35 million TEUs by 2017, DP World said in an emailed statement.
“Fairview Container Terminal offers the fastest access for vessels travelling between Asia and North America. The terminal also offers the highest productivity rates on the West Coast and an efficient rail link to the hinterland. The long-term concession and ability to build beyond the current phase 2 of expansion presents a fantastic opportunity for DP World,” stated Mohammad Sharaf, DP World group chief executive officer.
The concession to run the port is until 2034, which can be extended until 2056. The acquisition is on a debt free basis and subject to regulatory approval, which DP World expects to complete in the second half of 2015.
DP World shares closed up 2.04 per cent to $22 on the Nasdaq Dubai on Thursday following the announcement of the Fairview acquisition.
The ports operator already operates the CENTERM terminal Port Metro Vancouver, British Columbia, which is about 1,500 kilometres by road from Prince Rupert.
“We are delighted to extend our global footprint with a second terminal in Canada. The value proposition is compelling and the addition of capacity to our portfolio will contribute to DP World’s continued growth and the delivery of shareholder value,” stated Sultan Ahmad Bin Sulayem, DP World chairman.
Vancouver became DP World’s first North American operation when it acquired P & O Ports’ marine assets in 2006. The acquisition of P & O Ports became a political issue in the United States played out in the country’s national media. The purchase of P & O Ports’ marina assets included a number of major ports in the United States. At the time several high profile members of the US Congress opposed DP World operating port assets in the country over national security concerns. Lobbying on behalf of both parties took place for several months before DP World sold the US port assets to Global Investment Group for an undisclosed sum. Since then, DP World has not returned to the US market, although last year Sharjah-based Gulftainer secured a 35-year concession from Port Canaveral in Florida.
DP World recently completed the $2.6 billion acquisition of Economic Zones World, which owns Jebel Ali Freezone, from its parent company Dubai World.