INTERNATIONAL Container Terminal Services, Inc. (ICTSI) has forged a US$12.5-million business partnership to form a company that will invest, build and operate a river port and container terminal in the Democratic Republic of the Congo, the company has announced.
“The rationale for the transaction is to continue to expand the business and diversify geographically, and to support, participate in, and benefit from, the positive economic development in DRC,” ICTSI said in a filing with the Philippine Stock Exchange.
The Manila-based global port operator said it signed the deal – through its subsidiary ICTSI Coöperatief U.A. – with La Societe De Gestion Immobiliere Lengo (SIMOBILE) to set up the joint-venture company, International Container Terminal Services Inc.-DR Congo (ICTSI DR Congo).
ICTSI Congo-DR will be located on the riverbank of the Congo River in Matadi, the main entry point for containers into DRC serving the greater region and the Kinshasa market.
“We have been following the positive economic developments in DRC closely and are proud that we can take part in building the needed infrastructure for the future growth and prosperity of the country,” Enrique K. Razon Jr, ICTSI chairman and president, said in a press release.
Phase 1 of the facility will be able to handle 120,000 twenty-foot equivalent units (TEUs) and 350,000 metric tons. The capacity and berth length can be doubled in Phase 2, subject to demand.
The first phase, which will consist of two berths with a total length of 350 meters, is expected to be completed within 18 to 24 months from the start of construction, ICTSI said. Total capital expenditure for Phase 1 will be around $100 million.
A sum of $7.5 million will be contributed by ICTSI through ICSTI Cooperatief to ICTSI DR Congo’s $12.5-million initial capitalization while SIMOBILE will contribute a parcel of land valued at $5 million.
ICTSI, through ICTSI Coöperatief, will effectively own 60% of the total shareholding in ICTSI DR Congo, while SIMOBILE will own 40% thereof.
In January 2013, ICTSI said it is planning to acquire 10 new contracts over the next 10 years and is looking at ports in Africa such as Congo, the Ivory Coast, Kenya and Cameroon. ICTSI operates a port in Madagascar and Nigeria.
“We are looking forward to bringing new and improved service to this fast-growing economy. We believe we can make a positive impact and decrease total transportation time and cost through this modern and efficient facility,” states Jens O. Floe, ICTSI senior vice-president responsible for the Africa Region.
Map from www.un.int/wcm/content/site/congo
