DP World Limited today announces that it has entered into agreements to acquire Maritime World LLC , the 100% owner of Dubai Maritime City (DMC) , for a purchase consideration of US$ 180 million and to buy 100% of Drydocks World LLC (Drydocks) by means of a capital injection of US$ 225 million, taking the total cash required for the acquisitions of DMC and Drydocks to US$ 405 million.
DMC is a world class maritime service facility and industrial business zone in a prime location of central Dubai and adjacent to DP Worl d’s Mina Rashid. It is a maritime focused commercial and industrial park , which extends to 2.3 million sqm on a man -made peninsula and provides Economic Zones World FZE additional land as an alternative to the highly -occupied Jebel Ali Free Zone.
Drydocks World is a market leader in the ship repair business with the largest ship repair yard in the Middle East. The business delivers stable ship and rig repair revenues and has specialist capabilities in niche ship newbuilds and conversions.
Drydocks ’ acquisition will integrate well into P&O Maritime (POM) , which is DP World ’s 100% owned maritime services subsidiary. On a proforma basis, the US$ 225 million capital injection into Drydocks World represents a 2016A EBITDA multiple of 8.0 x. The acquisitions are expected to be earnings accretive from the first full year of consolidation.
On a proforma basis, DP World’s net leverage as of 1H2017 would be 2.9x Net Debt to EBITDA with these acquisitions compared to the reported 2.6x. Both acquisitions are subject to certain conditions precedent and the acquisition of Drydocks World is subject to the successful completion of its debt restructuring process. Both tra nsactions are expected to close before the end of the first quarter of 2018.
As the acquisitions are considered related party transactions under the DFSA Market Rules, DP World will comply with the relevant requirements of DFSA Market Rule 3.5.3.