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ICTSI takes over port concession in Brazil

/ 04:40 AM December 14, 2019

Tycoon Enrique Razon Jr.-led port operator International Container Terminal Services Inc. (ICTSI) has officially taken over the port terminal project at Port of Rio de Janeiro City in Brazil after getting all the regulatory clearance needed to consummate its P9.1-billion purchase of the port concession.

ICTSI also disclosed to the Philippine Stock Exchange on Friday that it had received about 27 million euros (P1.52 billion) from the Sudanese government as second partial repayment of the upfront fee for the aborted terminal project in Sudan.

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“We continue productive discussions with the Ministry of Finance and Economic Planning of the Republic of the Sudan for the refund of the remaining portion of the upfront fee under the terms of the refund bond,” ICTSI said.

The deal with ICTSI was canceled in April after workers at the container terminal went on strike to protest the Filipino company’s deal to operate, manage and develop the South Port Container Terminal at Port Sudan.

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In the meantime, ICTSI has started on the new project in Brazil. “All conditions precedent and required regulatory approvals have been obtained and the transfer of the facilities to ICTSI management has been set on the 12th of December 2019,” the company said.

“The transaction will expand ICTSI’s footprint in the Brazilian container terminal market and is expected to

generate value-accretive returns for ICTSI’s shareholders,” it said.

In July, ICTSI, through wholly owned subsidiary ICTSI Americas BV, signed a share purchase agreement with Boreal Empreendimentos e Participações S.A. to acquire 100 percent of the shares of Libra Terminal Rio S.A., which holds the concession rights to operate, manage and develop the container terminal 1 in the port of Rio de Janeiro.

The deal was executed after a public auction of Libra Rio, which was won by ICTSI.

Under Brazilian bankruptcy law, ICTSI acquires Libra Rio as an isolated operation unit, free and clear of any liabilities or contingencies of any other entities of Libra Group.

The concession of Terminal de Contêineres 1 (T1Rio) commenced in 1998 and was extended in 2011 until 2048.

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ICTSI will assume the operational, development and other responsibilities under the current concession contract.

In 2018, T1Rio had a throughput of about 135,000 TEUs (20-foot equivalent unit, which is used to measure a ship’s cargo carrying capacity) and an estimated capacity of 530,000 TEUs. It has state-of-the-art container terminal assets, including five ship-to-shore gantry cranes and an extensive range of yard handling equipment including more than 16 rubber-tired gantry cranes.

It has a total land area of 18.8 hectares and 715 meters of quay wall, with a design water depth of up to 16 meters, and thus the capability to receive the large container vessels of global shipping lines.

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TAGS: ICTSI, International Container Terminal Services Inc.
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