India: Essar Ports, PAI Announce Strategic Alliance
Essar Ports Limited, 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 aninvestment of approx. Rs 175 croreby PAI in Essar Ports.
PAI is the international investing arm of the Antwerp Port Authority, which is the port authority of the port of Antwerp, the 2nd 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 improvementand 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, Marc Van Peel, president of the Antwerp Port Authority: “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 30thMay 2012, PAI has invested approx. Rs 175 crore 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% 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 as Non-Executive Director in the Board of Essar Ports Ltd.
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 175 crore 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.
Dredging Today Staff, May 30, 2012