ICTSI sells stake in Davao del Norte port
Razon-led International Container Terminal Services Inc. (ICTSI) announced on Tuesday that its wholly owned subsidiary was disposing of its entire stake in a private commercial port in Davao.
In a disclosure on Tuesday, the listed port operator said Hijo Resources Corp. (HRC)—the minority partner in Hijo International Port Services Inc. (HIPSI)—agreed to buy ICTSI’s Abbotsford Holdings Inc. out of the joint venture with the conclusion of a share purchase agreement.
The deal involves Abbotsford selling 162,500 shares of HIPSI, which are equal to 65-percent ownership, to HRC for P325 million.
ICTSI said it unloaded its stake as the “expected market for HIPSI did not materialize.” It did not elaborate on why.
The transaction value was “negotiated and determined based on a discounted cash flow method.” ICTSI is set to settle an initial payment of P95 million. The balance will be paid in multiple tranches over the next eight quarters.
HIPSI operates a port in Barangay Madaum, Tagum, Davao del Norte.
Abbotsford and HRC invested in HIPSI in 2012 for the construction, development and operation of the port. HRC is a diversified group that has interests in leisure and tourism, agribusiness, property development and port operations.
The Hijo port, which handles break-bulk cargo, has two berths at 120 meters and 150 m long.In the first half, ICTSI saw its net earnings climb by 50 percent to $294.5 million from $196.7 million in the same period a year ago, thanks to better volumes and higher topline figures.
Consolidated volume in the first semester improved by 5 percent to 5.75 million twenty-foot equivalents (TEUs) from 5.46 million TEUs in the same period last year.
The port operator attributed this to “volume growth and general improvement in trade activities as economies continue to recover from the impact of the COVID-19 pandemic and lockdown restrictions; and new shipping lines and services at certain terminals.”
It spent $231.3-million worth of capital expenditures in the first half for its expansion projects in the Philippines, Australia, Congo, Mexico and Brazil. INQ
