Essar Ports announces strategic alliance with Port of Antwerp International
Essar Ports Limited (Essar Ports), one of the largest private sector port companies of India, today announced the creation of a long-term strategic alliance with Port of Antwerp International (PAI) and an investment of approximately Rs 175crore by PAI in Essar Ports, the Essar Group press release said.
PAI is the international investing arm of the Antwerp Port Authority, which is the port authority of the port of Antwerp, the second largest port in Europe handling 187 MMT of cargo in 2011, and a gateway to many European economies. The Antwerp Port Authority and Essar Ports will collaborate in the areas of training and consultancy services, port planning, traffic flow, quality and productivity improvement and will further build a mutually beneficial commercial relationship based on mutual business and investment preferences. Both Essar Ports and PAI will mutually assist in the growth in the volume of their businesses.
On this occasion, Mr. Marc Van Peel, President of the Antwerp Port Authority, said: “Essar Ports is a highly regarded, strong and reliable partner with a lot of know-how in India. We will rely on them for the development of port activities in India, one of the strategic regions of our daughter company PAI. The port of Antwerp will share her knowledge and expertise on port development and strategy with Essar Ports.This added value for both parties will create breeding grounds for further development of both regions.”
As a part of the Strategic Alliance Agreement signed between the two parties on May 30, 2012, PAI has invested approximately Rs 175crore in Global Depository Shares (GDS) of Essar Ports at a price of Rs 100 per share equity share underlying the GDS. These GDS would form approximately 4 per cent of the diluted equity share capital of Essar Ports. PAI’s investment in Essar Ports is long-term and strategic in nature, focusing on the commercial relationship between the two companies and mutually enhancing the productivity, skill set and performance. PAI will also have the right to nominate a director on the Board of Essar Ports and Mr. Jan Adam, CFO - Port of Antwerp, has been appointed Non-Executive Director in the Board of Essar Ports.
On this occasion, Mr. Rajiv Agarwal, Managing Director of Essar Ports, said, “We are extremely happy that port of Antwerp, which is Europe’s second largest port, has partnered with us. This partnership will promote growth of port traffic between port of Antwerp and ports of Essar, and help us in developing world class port facilities with focus on quality, productivity and environment.”
Key feature and benefits of the strategic alliance:
Infusion of approx. Rs 175crore of equity at Rs 100 per share through Global Depository Receipts
Recognizing the attractiveness and potential of port assets of Essar Ports
Growth of port traffic between Port of Antwerp and Ports of Essar
Access to relationship with port operators and port based companies operating in Port of Antwerp
Developing world-class port facilities with focus on quality, productivity and environment
About the Port of Antwerp
Antwerp Port Authority (as defined hereinafter), is the port authority for the port of Antwerp, an international port based in Belgium and the second largest port in Europe and a leading port in the world. The port of Antwerp is the gateway to Europe, handling 187 million tonnes of freight in 2011.
PAI is a subsidiary of the Antwerp Port Authority and was founded in June 2010 as investing and consultancy arm of the Antwerp Port Authority with the mission to capitalize on the expertise of the Antwerp port sector and to establish a global port network via specific investments and consultancy.
Besides India, PAI is also considering opportunities in West Africa, Brazil and South East Asia. PAI has signed an agreement with Rent A Port and the Omani Government to develop a new port in Duqm.
About Essar Ports
Essar Ports is one of the largest private sector port companies of India, with a current capacity of 88 MTPA. The capacity is being expanded to 158 MTPA over the next few years.
Essar Ports has two operational ports at Hazira and Vadinar. The Hazira port is an all-weather, deep-draft port with 30 MTPA of dry bulk and break bulk cargo handling capacity. Vadinar is also an all-weather, deep-draft port with 58 MTPA of liquid cargo handling capacity.
Essar Ports is currently developing two terminals at Paradip with a capacity of 30 MTPA comprising an iron ore berth of 16 MTPA and a coal berth of 14 MTPA. The company is also setting up a dry bulk terminal at Salaya with a capacity of 20 MTPA. Additionally, the company plans to expand its Hazira port capacity by 20 MTPA – taking its capacity to 50 MTPA
About Essar Group
The Essar Group is a multinational conglomerate and a leading player in the sectors of steel, energy, power, construction, retail, shipping, ports, infrastructure and services. With operations in more than 25 countries across five continents, the Group employs 75,000 people, and has revenues of USD 27 billion.