Keppel T&T expands with third port project in China
Keppel Logistics (Foshan) Limited (KLF), a subsidiary of Keppel Telecommunications & Transportation Limited (Keppel T&T), has acquired a 60%-stake in Foshan Sanshui Port Development Co., Ltd (Sanshui Port), in Foshan City, Guangdong Province, China for approximately RMB 166 million, said in the company's press release.
With the other 40% held by the Sanshui local government, this project will be KLF's second integrated port logistics facility in Foshan City.
Located strategically along the Xijiang River, which is the western tributary of the Pearl River, Sanshui Port will complement KLF's existing Lanshi Port, which is also located in Foshan City. Sanshui Port's geographical location and its proximity to railway cargo hubs and major highways allow it to effectively serve the rest of Guangdong, as well as the nearby trading hubs in Hong Kong, Shenzhen and Nansha.
The 22.7-ha port has a 160m long multi-purpose berth and over 5,000 sm of warehousing space. This will increase KLF's total warehousing capacity to 81,000 sm. In operation since 2000, Sanshui Port has an annual handling capacity of approximately 300,000TEU.
Mr Pang Hee Hon, CEO of Keppel T&T said, "Sanshui Port will expand our presence in Southern China, where we have successfully operated for the past 19 years. It will also enable us to meet untapped demand in the fast growing province and synergise our existing operations."
Despite the global economic downturn, in 2012, Guangdong enjoyed robust growth with its GDP increasing by 10.2% year-on-year to reach RMB 5.7 trillion, while its import and export grew by 7.7%. Since its inception in 1994, KLF has grown Lanshi Port's throughput by more than six-fold, from 41,600 TEU to 264,000 TEU in 2012.
Mr Pang added, "With our proven track record in Lanshi Port, we will replicate our integrated port logistics model and grow Sanshui Port, in tandem with the market conditions, to meet the demands of our clients for higher value logistics solutions."
The contract signing ceremony was witnessed by Mr Zhong Feijian, Executive Vice Mayor of Sanshui District and Mr Pang, and other senior government officials from the district government. The agreement was signed between Mr Vincent Ko, CEO (China Business Unit) of Keppel T&T and Chairman of KLF and Mr Li Weimao, Chairman of Guangdong Sanshui Development Investment Holding Co., Ltd.
The foregoing transaction is not expected to have any material impact on the net tangible assets and consolidated earnings per share of Keppel T&T for the current financial year.
