French shipping group CMA CGM’s port terminals subsidiary, Terminal Link, is among three entities prequalified by the Development Bank of Jamaica (DBJ) to take over the operation of the Kingston Container Terminal (KCT), which is up for divestment.
The others are Dubai-based DP World, and PSA International, formerly Port of Singapore Authority, one of the world’s largest port operators.
“We are now conducting due diligence so we can go back to the Government with the exact strategy that we are going to use and we hope to have a preferred bidder by April, May (or) June next year,” general manager of privatisation services at the DBJ, Denise Arana, told a Gleaner Editors’ Forum.
KCT, Jamaica’s main seaport, is to be privatised by way of concession, but the structure is still being formulated, the DBJ said in July.
However, the bank said that as far as possible, the concession will give the preferred bidder the right to purchase KCT’s equipment as part of the package.
KCT is one of the region’s leading container transhipment ports with a capacity of 2.8 million 20-foot equivalent units or TEUs.
Its equipment includes 19 ship-to-shore Gantry cranes, with four super Post-Panamax cranes among them; 30 stevedoring chassis; 28 yard tractors; 30 yard trailers; two 4,000 horse-power tugboats, 73 straddle carriers, 24 trailer trains, four train tractors and nine forklifts.
Further development of the KCT is expected to facilitate the passage of Post-Panamax container vessels with a nominal capacity of 12,000 TEUs in comparison to the existing Panamax vessels with a capacity of 4,500 TEUs currently transiting the Panama Canal.
35-YEAR LEASE
CMA CGM already has a presence at KCT, having signedan agreement with the Jamaican Government in August 2011, which will see the company investing US$100 million to improve infrastructure and equipment, as well as employ 1,000 persons in exchange for a 35-year lease to set up a major hub there.
At the signing, then Minister of Transport and Works Mike Henry said the agreement represented a significant step forward in the Government’s programme for the privatisation of the KCT.
However, the Port Authority said the CMA CGM agreement was separate from the planned divestment of the port.
Earlier this year, China Merchant Holdings International, China’s largest state-run ports operator, acquired a 49 per cent equity stake in Terminal Link for euro400 million. The transaction was completed on June 11, according to Port Finance International, an online platform for industry experts and players to review and discuss the market.
With a fleet of more than 400 vessels, Marseilles-based CMA CGM is the world’s third largest container shipping company. Its subsidiary Terminal Link owns 15 container terminals in eight countries.
DP World is majority owned by Dubai World, is an investment vehicle used by the Dubai government to manage and supervise a portfolio of businesses and projects across a range of industry segments and projects that promote the country as a hub for commerce and trading.
DP World operates more than 60 terminals across six continents, with container handling generating around 80 per cent of its revenue, Port Finance International reported.
The PSA Group handled 60.1 million 20-foot equivalent units globally last year, Group Chair-man Fock Siew Wah said in the company’s 2012 annual report.
