Global ports operator DP World and Evyap Group have merged their Turkish operations to create a logistics business aimed at boosting trade in the country whose economy is expected to stabilise
The new company, DP World Evyap, will give the Dubai-based ports operator a 58 per cent stake in Evyapport while Evyap Group will get a 42 per cent share of DP World Yarimca.
Evyaport operates in the Izmit Bay of Izmit province while DP World Yarimca is one of the largest container terminals in Turkey.
The rebranding will also introduce DP World Evyap Yarimca and DP World Evyap Korfez as the new names for the maritime centres.
Plans to form a strategic equity partnership between the companies were first revealed in August last year.
DP World Evyap will have a combined 2,088 metres of berthing space, with total annual container handling capacity expected to exceed two million twenty-foot equivalent units (TEUs).
It is also expected to shorten operation times as DP World Evyap will gain access to advanced road and rail links.
“DP World’s vision is to lead global trade to a stronger, more efficient and sustainable future,” Sultan bin Sulayem, group chairman and chief executive of DP World Group, said on Friday.
“Our strategic partnership with Evyapport advances this strategy in Turkey.”
The merger will bring “enhanced end-to-end solutions to our customers and the many benefits in speed and efficiency”, he added.
The shipping sector is key to Turkey's economy, which has faced a number of challenges, most notably chronic inflation, after years of unorthodox policies.
However, the economy is gaining some momentum.
S&P Global Ratings upgraded Turkey's credit rating outlook in May, citing the government's strategy of taking a more rebalanced approach to generate confidence in its economy.
Investor confidence in the country is also projected to grow after the Financial Action Task Force last month removed Turkey from its “grey list” of countries that face tighter monitoring for money laundering and terrorism financing.
Turkey's shipping sector has undergone a “significant transformation in recent years, positioning itself more effectively on the global stage”, Cihan Ergenc, president of the Turkish Shipowner’s Association, wrote in the organisation's most recent annual outlook report.
Turkey's shipping industry posted a 67 per cent growth over 2022 and 2023. The industry has continued to invest in areas such as shipbuilding, fleet management and port services to enhance its competitiveness, he said.
Meanwhile, DP World has continued to expand its footprint globally. In June, it completed a $400 million expansion project at the Port of Callao in Peru as part of its efforts to increase capacity across Latin America.
In May, DP World and the Saudi Ports Authority began construction of a logistics park in the coastal city of Jeddah, which is expected to grow the kingdom as a crucial trade centre in the Middle East.
The latest merger is expected to “bring significant economic benefits to Turkey and the wider region”, said Kris Adams, chief executive of DP World Turkey.
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Name: Kumulus Water
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The specs: 2018 Nissan 370Z Nismo
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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