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Container terminal ownership and operators
Port Finance International conferenceLondon
9 November 2011
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Definitions of international terminal operators and owners
Measuring terminal operation and ownership
The main international players
Emerging international terminal operators
Remaining scope for terminal privatisation and M&A
Agenda
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Definitions of international terminal operators and owners
Measuring terminal operation and ownership
The main international players
Emerging international terminal operators
Remaining scope for terminal privatisation and M&A
Agenda
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What do we mean by terminal operation and ownership?
Terminal operator
Investor
Parent company Owner
Shareholder
Manager
HybridsShipping Lines
Stevedores
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Terminal “ownership” complexity
Terminal company shareholders
Company holding terminal lease or
concession
Stevedoring company / labour provider
(in some instances esp. in USA)
Terminal management contract
(in some instances)
Investors / ownersEquity Contract
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Terminal “ownership” complexityLarge financial institution +
other shareholders
International terminal operator
Major and minor shareholders
Shipping line
Terminal company
Stevedoring company
(in some instances)
50% 50%
100%
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What is a global terminal operator (GTO)?
Drewry definition: Terminal operations/ownership in more than one world region
Very few truly global terminal operators (HPH, DPW, APMT, PSA)
Most are international terminal operators (ITOs)
Some companies are “international” but only just
Some large “single region” operators e.g. Bollore in Africa
Some large single country operators e.g. Ports America in the US, Modern Terminals in China, Transnet in South Africa
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Definitions of international terminal operators and owners
Measuring terminal operation and ownership
The main international players
Emerging international terminal operators
Remaining scope for terminal privatisation and M&A
Agenda
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How to measure GTO/ITO activity?
Total teu (no account taken of shareholding %age) –simple approach but double counting problem
Equity teu (volumes adjusted according to shareholding) –better measure but operators owning operators is a problem…..and owners owning owners!
Stevedoring vs. terminal ownership – USA especially
Management control of terminals
Day to day operations and development
Strategic direction
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Why bother measuring terminal operation and ownership?
Important to understand: the structure of the industry the strategies and motivations of
operators and investors who the key players are and why how things change over time what the future might hold what opportunities exist
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Definitions of international terminal operators and owners
Measuring terminal operation and ownership
The main international players
Emerging international terminal operators
Remaining scope for terminal privatisation and M&A
Agenda
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Top 15 GTOs/ITOs, 2010, million equity teu
Note: No adjustments to PSA and HPH figures to reflect PSA’s 20% stake in HPH
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Top 10 GTOs/ITOs – Degree of internationalism
Proportion of 2010 equity teu derived from terminals outside the operators home base country
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Top 10 GTOs/ITOs – Degree of management control
Estimated proportion of 2010 equity teu under management control
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Variations between top 10 GTOs/ITOs
Internationalism %
Management control %
100%
100%
0%
PSA HPH
DPW
APMT
COSCO
MSC
SSA
Evergreen
Eurogate
HHLASize of circle
reflects equity teu total
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Definitions of international terminal operators and owners
Measuring terminal operation and ownership
The main international players
Emerging international terminal operators
Remaining scope for terminal privatisation and M&A
Agenda
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Emerging ITOs
Existing GTOs/ITOs are well established and highly experienced
But there are some new players emerging: China and Middle East: Cash rich organisations keen to
expand India: Political desire to expand overseas European and US based operators seeking to expand
selectively (OECD)
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Emerging ITOs – Some examples
China Shipping – US west coast
SIPG – 25% stake in APMT Zeebrugge
China Merchants – purchased stake in terminal in Lagos, Nigeria, also investing in Colombo expansion and Vietnam
Gulftainer – Iraq and Brazil, also Russia (multi-purpose terminal)
Noatum – OECD focus for expansion beyond Spain
Ports America – US based but may expand overseas
IPH – Stake in Exolgan, Buenos Aires, plus Port of Brisbane
Yildirim – 20% stake in CMA CGM, plus 50% stake in Malta Freeport
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Definitions of international terminal operators and owners
Measuring terminal operation and ownership
The main international players
Emerging international terminal operators
Remaining scope for terminal privatisation and M&A
Agenda
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Remaining terminal privatisation potential
In 2010 there were about 50 terminals worldwide handling more than 250,000 teu p.a. and in state ownership.
Recent deals are reducing this number e.g. Gothenburg, Kingston, Puerto Limon
Most significant remaining locations today: South Africa Israel Iran Kenya Mauritius Egypt Sri Lanka Turkey
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Privatisation of port authorities/companies is currently gaining momentum Brisbane and Abbot Point (done) Poti – Georgia (done) Monrovia – Liberia (done) Eilat (under way) Dover (planned) Piraeus & Thessaloniki (planned) Port Botany (Sydney) (planned)
In Australia, long term leases rather than outright sales in some instances e.g. Brisbane and Abbot Point (99 years)
Main reasons for the privatisation trend: access to private money access to expertise (developing world especially)
Privatisation potential – Port authorities/companies
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Terminal ownership and operation is complex and can be looked at many ways
No definitive way of measuring but important to measure nevertheless
Drewry is developing new ways to analyse the industry
Some significant new international terminal operators/owners are likely to emerge in the coming years
Privatisation potential is still there, but getting more limited, especially for larger terminals
M&A activity likely to be an ongoing focus
Conclusions