DP World, one of the world's biggest port operators, agreed to acquire Chile ports operator Puertos y Logistica (Pulgosa), giving it access to five regional ports as it expands its footprint in South America.
The Dubai-based operator will take a 71 .3 per cent stake in the Santiago-listed company from Minera Valparaiso and other shareholders associated with the Matte Group, DP World said on Sunday. It will offer $502 million (Dh1.84 billion) in a tender for the full ownership of the business, which has a market value of $170.1m.
Pulgosa operates a long-term concession for Puerto Central (PCE) in San Antonio in addition to owning and operating Puerto Lirquen (PLQ) in southern Chile.
"These new assets will allow DP World to serve cargo owners and shipping lines at five key gateways on the west coast of South America in Posorja [Ecuador], Callao and Paita [Peru] and San Antonio and Lirquen [Chile]," said Sultan bin Sulayem, DP World chairman. "The overall value proposition for these terminals is compelling."
DP World operates several ports in South America including container terminals in Peru's Port Callao and Brazil's Port of Santos and Argentina's Terminales Rio de la Plata in Buenos Aires. The expansion push in South America comes after DP World warned in October that the near-term outlook for Dubai's Jebel Ali Port remained challenging. Its third quarter consolidated volumes for the Americas and Australia rose 17 per cent year on year.
___________
Read more:
DP World reports drop in shipping container volumes due to 'market caution'
DP World launches $442m port expansion in Somaliland
___________
DP World fell 1.09 per cent at the market close on Sunday on Nasdaq Dubai, where its shares are traded.
Pulogsa has net financial debt of $226m as of September 30 and the deal is expected to close in the first half of the year, DP World said.
The UAE company expects the acquisition to be "earnings accretive" in the first full year of consolidation and that it will be financed from existing balance sheet resources.
"PCE and PLQ are both ‘best in class’ terminals in their respective markets, with long-term operating rights, strong cargo diversification and significant capability for expansion," Mr bin Sulayem said.
PCE is one of Chile's largest container ports with a capacity of more than one million Twenty-Foot Equivalent (TEUs) and potential for further capacity expansion, according to DP World.
PLQ is a multipurpose terminal that handles containers, general cargo and dry bulk. The port is positioned next to the country’s second-largest city and industrial hub Concepción and is set to benefit from the pulp and lumber industry in Southern Chile, according to DP World.
DP World has appointed Scotiabank its financial advisor.
Election pledges on migration
CDU: "Now is the time to control the German borders and enforce strict border rejections"
SPD: "Border closures and blanket rejections at internal borders contradict the spirit of a common area of freedom"
At a glance
Global events: Much of the UK’s economic woes were blamed on “increased global uncertainty”, which can be interpreted as the economic impact of the Ukraine war and the uncertainty over Donald Trump’s tariffs.
Growth forecasts: Cut for 2025 from 2 per cent to 1 per cent. The OBR watchdog also estimated inflation will average 3.2 per cent this year
Welfare: Universal credit health element cut by 50 per cent and frozen for new claimants, building on cuts to the disability and incapacity bill set out earlier this month
Spending cuts: Overall day-to day-spending across government cut by £6.1bn in 2029-30
Tax evasion: Steps to crack down on tax evasion to raise “£6.5bn per year” for the public purse
Defence: New high-tech weaponry, upgrading HM Naval Base in Portsmouth
Housing: Housebuilding to reach its highest in 40 years, with planning reforms helping generate an extra £3.4bn for public finances
FFP EXPLAINED
What is Financial Fair Play?
Introduced in 2011 by Uefa, European football’s governing body, it demands that clubs live within their means. Chiefly, spend within their income and not make substantial losses.
What the rules dictate?
The second phase of its implementation limits losses to €30 million (Dh136m) over three seasons. Extra expenditure is permitted for investment in sustainable areas (youth academies, stadium development, etc). Money provided by owners is not viewed as income. Revenue from “related parties” to those owners is assessed by Uefa's “financial control body” to be sure it is a fair value, or in line with market prices.
What are the penalties?
There are a number of punishments, including fines, a loss of prize money or having to reduce squad size for European competition – as happened to PSG in 2014. There is even the threat of a competition ban, which could in theory lead to PSG’s suspension from the Uefa Champions League.
How The Debt Panel's advice helped readers in 2019
December 11: 'My husband died, so what happens to the Dh240,000 he owes in the UAE?'
JL, a housewife from India, wrote to us about her husband, who died earlier this month. He left behind an outstanding loan of Dh240,000 and she was hoping to pay it off with an insurance policy he had taken out. She also wanted to recover some of her husband’s end-of-service liabilities to help support her and her son.
“I have no words to thank you for helping me out,” she wrote to The Debt Panel after receiving the panellists' comments. “The advice has given me an idea of the present status of the loan and how to take it up further. I will draft a letter and send it to the email ID on the bank’s website along with the death certificate. I hope and pray to find a way out of this.”
November 26: ‘I owe Dh100,000 because my employer has not paid me for a year’
SL, a financial services employee from India, left the UAE in June after quitting his job because his employer had not paid him since November 2018. He owes Dh103,800 on four debts and was told by the panellists he may be able to use the insolvency law to solve his issue.
SL thanked the panellists for their efforts. "Indeed, I have some clarity on the consequence of the case and the next steps to take regarding my situation," he says. "Hopefully, I will be able to provide a positive testimony soon."
October 15: 'I lost my job and left the UAE owing Dh71,000. Can I return?'
MS, an energy sector employee from South Africa, left the UAE in August after losing his Dh12,000 job. He was struggling to meet the repayments while securing a new position in the UAE and feared he would be detained if he returned. He has now secured a new job and will return to the Emirates this month.
“The insolvency law is indeed a relief to hear,” he says. "I will not apply for insolvency at this stage. I have been able to pay something towards my loan and credit card. As it stands, I only have a one-month deficit, which I will be able to recover by the end of December."
