(MENAFN - Khaleej Times) DP World has entered into two transactions to monetise its interests in two container terminals and a logistics centre in Hong Kong.
The transactions will see DP World monetise 75 per cent of its interests in CSX World Terminals Hong Kong, which operates berth 3 of the Kwai Chung Container Terminal and ATL Logistics Centre Hong Kong, a logistics centre located alongside Kwai Chung, and 100 per cent of its interest in Asia Container Terminal, which operates Asia Container Terminal 8 West, or CT8, DP World said in a Press release.
The total consideration to be received by DP World for the two transactions is 742 million including the repayment of certain shareholder loans. The proceeds will go towards maintaining a strong capital position. The total net gain is expected to be approximately 151 million, subject to transaction costs and currency movements.
DP World will divest 75 per cent of its equity interests in Kwai Chung and ATL, for a cash consideration of 463 million, to the Goodman Hong Kong Logistics Fund to form a strategic partnership in respect of these assets. As part of the strategic partnership, DP World will continue to manage port operations.
Its completion, subject to regulatory approvals, is expected to be towards the end of the first half of 2013.
DP World will also divest all its 55.16 per cent interest in Asia Container Terminals Holdings, the holding company of the entity that owns and operates CT8, for a cash consideration of HK2,161 million (279 million), to Hutchison Port Holdings Trust. This transaction was closed earlier on Thursday.
As at December 31, 2012, the value of the assets disposed of was 653 million and they contributed a total of 39 million to DP World's gross profit.
"We believe Hong Kong will continue to be a very interesting market however, our presence was small relative to the market. This reorganisation, forming a strategic partnership and partially monetising some assets, allows us to realise value and recycle capital into new, fast growing opportunities in other markets," DP World chairman Sultan Ahmed bin Sulayem said.
"We are delighted that Goodman is joining us as strategic partners in Hong Kong. Their experience in the logistics sector, combined with our expertise as a global port operator, will ensure that our focus is on delivering the highest level of service to our customers. We look forward to building on our successful track record of operating container terminals in Asia," DP World group chief executive officer Mohammed Sharaf said.
"Combined, these transactions value our assets in Hong Kong at 14.9 times 2012 EV/Ebitda which, together with the proceeds of 742 million, make these very attractive for DP World," DP World chief financial officer Yuvraj Narayan said.