China Merchants Holdings acquires a 50% stake in a container terminal in Togo
China Merchants Holdings (International) Company Limited (Hong Kong Stock Code: 0144) is pleased to announce that it has completed the acquisition of a 50% interest in Thesar Maritime Limited. ("TML"). TML owns a 35-year concession right, extendable for another 10 years, to develop and operate the Lom Container Terminal ("LCT"), which upon full completion will be a 4-berth terminal located on a quayline of 1,050 metres and a yard area of 53 hectares, according to the Concession Agreement granted by the Togolese Government in December 2011. The planned maximum annual capacity of LCT is 2.2 million teus.
The vendor, which remains a 50% shareholder in TML, is part of Terminal Investment Limited (the "TIL Group") which has a commercial relationship with Mediterranean Shipping Co SA ("MSC"), the world¡¯s 2nd largest container shipping company. The TIL Group is one of the largest and most geographically diverse terminal businesses globally, in 24 operating terminals and 4 terminals under construction, including LCT.
LCT, Togo's only container terminal and a deep-water terminal in the Gulf of Guinea, is expected to be the first completed in this West African Region and is thus well-positioned to be the highest quality container transshipment hub servicing the Region. Container volume growth for this Region grew, on a compound average basis, 10.3% pa for the past 15 years.
Construction of LCT will be undertaken in phases, with the first 400m of quayline expected to be ready for operation by December 2013.
MSC has agreed, under a terminal service agreement signed between MSC and LCT, to use LCT's service for 15 years from the terminal's inauguration. The vendor has also committed to put forth its best efforts to assist LCT's container volume growth in support of the terminal's future business development.
Dr. Fu Yuning, CMHI Chairman, indicates, Having made concrete inroads through our investment in Tin-can Island Container Terminal in Lagos, Nigeria which has delivered satisfactory results, we are continuing our positioning in container terminal investment in the promising African market. The LCT project reflects yet again CMHI's on-going efforts to expand our international footprint.
Given its maritime proximity and its natural sea-depth, Lome lies strategically as Togo's key import and export channel. He adds, Combined with the Togolese Government's open and free trade policies and LCT's scheduled completion, the terminal is equipped to service cargo flows along the Gulf of Guinea and will stand to rapidly become a key transshipment hub for the West African Region.
Furthermore, LCT's land connectivity with the rest of Togo and its neighboring countries such as Ghana, Benin, infers its future potential in capturing land-based cargo flows derived from West African countries.
"Strategically, not only does this investment further anchor CMHI's position in West Africa, it also enables us to leverage the resources we have already committed for the Tin-Can project onto LCT thereby optimizing our investment return in the Region. In addition, the transaction reflects the deeper working relationship we are forging with MSC. Dr Fu stresses, All in all, this marks another important step in our endeavour to expand our ports investment in not only Africa but also other regions, and the benefit so retrieved will no doubt enhance CMHI's competitiveness in Western Shenzhen and other parts of China as well as in the international arena."
