Dubai’s DP World in $500m deal to buy Chile port firm

Dubai’s DP World said it would offer $502 million for 100 percent equity ownership. (Reuters)
Updated 13 January 2019

Dubai’s DP World in $500m deal to buy Chile port firm

  • Pulogsa operates concession for Puerto Central in San Antonio and owns and operates Puerto Lirquen terminal
  • DP World is one of the world’s largest port operators

LONDON: The Dubai-based DP World is set to buy a 71.3 percent stake in the Chilean port services firm Puertos y Logistica, known as Pulogsa.

The move will give DP World exposure to several terminals in Chile, with Pulogsa holding a long-term concession for Puerto Central (PCE) in San Antonio, as well as owning and operating Puerto Lirquen (PLQ) terminal.

The Dubai port operator said it has entered into an agreement to acquire the stake from Minera Valparaiso and other shareholders associated with the Matte Group.

Under a tender process to acquire all outstanding shares of the business, DP World will offer $502 million in consideration for 100 percent equity ownership, according to a statement.

The acquisition will be financed from existing balance sheet resources, and is expected to close in the first half of 2019, the statement said.

Pulogsa, which is listed on the Santiago stock exchange, had net financial debt of $226 million as at Sept. 30, 2018, the statement added.

“We are delighted to extend our global footprint with a major entry into Chile, Latin America’s most developed economy, with attractive growth prospects and a dynamic business environment,” said DP World Group Chairman and CEO Sultan Ahmed bin Sulayem.

“These new assets will allow DP World to serve cargo owners and shipping lines at five key gateways on the west coast of South America.”

The PCE terminal, in San Antonio, is one of Chile’s largest container ports, with a capacity of over 1 million twenty-foot-equivalent units (TEUs), a standard measurement in shipping.

“PCE and PLQ are both ‘best in class’ terminals in their respective markets, with long-term operating rights, strong cargo diversification and significant capability for expansion. The overall value proposition for these terminals is compelling and the addition of capacity to our portfolio will help drive long-term value to all our stakeholders,” said Sulayem.


Saudi energy giant to invest $3bn in Bangladesh’s power sector

Updated 22 October 2019

Saudi energy giant to invest $3bn in Bangladesh’s power sector

  • Experts say deal will usher in more economic and development opportunities for the country

DHAKA: Saudi Arabia’s energy giant, ACWA power, will set up an LNG-based 3,600 MW plant in Bangladesh after an agreement was signed in Dhaka on Thursday.

The MoU was signed by ACWA Chairman Mohammed Abunayyan and officials from the Bangladesh Power Development Board (BPDB), officials told Arab News on Monday.

According to the agreement, ACWA will invest $3 billion in Bangladesh’s energy development sector, of which $2.5 billion will be used to build the power plant while the rest will be spent on an LNG terminal to facilitate fuel supply to the plant. Under the deal, ACWA will also set up a 2 MW solar power plant.

In recent months, both countries have engaged in a series of discussions for investment opportunities in Bangladesh’s industry and energy sectors. 

During the Saudi-Bangladesh investment cooperation meeting in March this year, Dhaka proposed a $35 billion investment plan to a high-powered Saudi delegation led by Majed bin Abdullah Al-Qasabi, the Saudi commerce and investment minister, and Mohammed bin Mezyed Al-Tuwaijri, the Saudi economy and planning minister.

However, officials in Dhaka said that this was the first investment deal to be signed between the two countries.

“We have just inked the MoU for building the LNG-based power plant. Now, ACWA will conduct a feasibility study regarding the location of the plant, which is expected to be completed in the next six months,” Khaled Mahmood, chairman of BPDB, told Arab News.

He added that there are several locations in Moheshkhali, Chottogram and the Mongla port area for the proposed power plant.

“We need to find a suitable location where the drift of the river will be suitable for establishing the LNG plant and we need to also consider the suitability of establishing the transmission lines,” Mahmood said.

“It will be either a JV (Joint Venture) or an IPP (Independent Power Producer) mode of investment, which is yet to be determined. But, we are expecting that in next year the investment will start coming here,” Mahmood said.

BPDB expects to complete the set-up process of the power plant within 36 to 42 months.

“We are in close contact with ACWA and focusing on the successful completion of the project within the shortest possible time,” he said.

Abunayyan said that he was optimistic about the new investment deal.

“Bangladesh has been a model for the Muslim world in economic progress. This is our beginning, and our journey and our relationship will last for a long time,” Abunayyan told a gathering after the MoU signing ceremony.

Economists and experts in Bangladesh also welcomed the ACWA investment in the energy development sector.

“This sort of huge and long-term capital investment will create a lot of employment opportunities. On the other hand, it will facilitate other trade negotiations with the Middle Eastern countries, too,” Dr. Nazneen Ahmed, senior research fellow at the Bangladesh Institute of Development Studies (BIDS), told Arab News.

She added that Bangladesh needs to weigh the pros and cons before finalizing such contracts so that the country can earn the “maximum benefits” from the investment.

“It will also expedite other big investments in Bangladesh from different countries,” she said.

Another energy economist, Dr. Asadujjaman, said that Bangladesh needs to exercise caution while conducting the feasibility study for such a huge investment.

“We need to address the environmental aspects, opportunity costs and other economic perspectives while working with this type of big investment. Considering the present situation, the country also needs to focus on producing more solar energy,” Dr. Asadujjaman told Arab News.