ICTSI inks P10 B deal to take over Brazil terminal

MANILA, Philippines — Ports operator giant International Container Terminal Services Inc. (ICTSI) has signed a P10-billion share purchase agreement with Boreal Empreendimentos e Participações S.A. to formalize its take over of the concession rights to manage and develop a container terminal in the port of Rio de Janeiro City, Brazil.

In a disclosure, ICTSI said the share purchase agreement with Boreal was inked on July 19 to acquire 100 percent of the shares of Libra Terminal Rio S.A., which holds the concession rights to operate, manage and develop the container terminal Terminal de Contêineres 1 (T1Rio) in the port of Rio de Janeiro City.

The agreement involves the acquisition of ICTSI, through its wholly-owned subsidiary ICTSI Americas B.V, a total of 272.058 million shares composed of 85.115 million secondary shares and approximately 186.943 million new shares for a total amount of 740 million Brazilian Reais, or about P10 billion.

Boreal is a Brazilian wholly-owned subsidiary of the privately owned Libra Group, which is under judicial reorganization.

Under Brazilian bankruptcy law, ICTSI acquires Libra Rio as an isolated operation unit, free and clear of any liabilities or contingencies of any other entities of Libra Group.

ICTSI will assume the operational, development and other responsibilities under the current concession contract of T1Rio, which was extended in 2011 until 2048.

ICTSI said the transfer of the facilities to the company’s management is expected to take place late this year, “once all conditions precedent and all required regulatory approvals have been obtained.”

“The transaction will expand ICTSI’s footprint in the Brazilian container terminal market and is expected to generate value-accretive returns for ICTSI’s shareholders,” the publicly listed firm of billionaire Enrique Razon Jr. said.

T1Rio had a throughput of 135,000 TEUs and a capacity in excess of 530,000 TEUs last year.

The container terminal has a total land area of 18.8 hectares and 715 meters of quay wall and has state-of-the-art assets, including five ship-to-shore gantry cranes and an extensive range of yard handling equipment.