HONG KONG : Port operator PSA International has agreed to
acquire a 57 percent stake in Hong Kong's Asia Container Terminal,
or ACT, from developer Sun Hung Kai Properties.
No financial details were given, but the deal is reported to be
worth US$333 million, with PSA assuming $77 million worth of
debt.
Analysts say that puts the selling price at four times the
estimated book value.
Three years ago, Asia Container Terminals was worth about US$159
million, so PSA may be paying a huge premium, going by the reported
price.
But it indicates just how much PSA wants this strategic foothold in
Hong Kong.
PSA has been expanding its international presence aggressively
around Asia in recent years.
And now, it has finally landed a presence in Hong Kong, one of the
world's busiest container ports.
The purchase comes less than two weeks after PSA lost a bidding
battle with Sun Hung Kai Properties to buy Hongkong Land's 29
percent stake in ACT.
ACT is one of five operators in the Kwai Chung container hub, which
handles the majority of Hong Kong's container traffic.
But still, it has yet to secure its first customer, despite having
acquired two berths there.
Said Francis Lun, general manager at Fulbright Securities, "It's
doubtful that with these kind of figures that PSA will be able to
make a profit from Terminal 8 in the foreseeable future.
"But you also have to look at it another way: how much is a
meaningful contributing stake in Terminal 8 worth? Because Hong
Kong is one of the largest ports not only in Asia and China but the
world, if PSA is to be a global player in the cargo handling
container terminal business, it has to have a contributing stake in
one of the key terminals."
ACT aside, PSA is also taking the lead in the race to buy US rail
giant CSX Corp 17 percent stake in its global port network.
Reports say PSA is willing to shell out upwards of US$1 billion for
its assets in Hong Kong, Germany and Venezuela. - CNA