Global Ports Investments PLC announced that the Group has recently completed the acquisition of 100% of the share capital of NCC Group Limited (together with its subsidiaries, NCC Group), in a transaction which was announced on 2 September 2013.
The acquisition of NCC Group, the second largest container terminals operator in Russia1, strengthens Global Ports leading position in the growing Russian container market. The enlarged Global Ports (Enlarged Group) will operate nine container terminals2, with a total marine container handling capacity of approximately 4 million TEUs (as of 30 June 2013), located in both the Baltic Sea and Far East Basins which are key gateways for Russian container cargo. The Enlarged Group is now the largest container terminal operator in Eastern Europe and one of the top-20 container operators globally3.
The Transaction provides potential for greater operational efficiency through improved terminal network management. The combination of NCC Group and Global Ports will enable shipping line customers to benefit from network savings through improved call rationalisation, better berth utilisation and enhanced productivity. The Transaction creates a basis for the Enlarged Group to reduce overhead costs as well as to centralise support functions. The Enlarged Group will have approximately 1.12 million4 TEUs of available capacity enabling it to accommodate future throughput growth while reducing the Groups capital expenditure.
Global Ports has elaborated a detailed plan for the integration of NCC Group based on applying best practices and leveraging the wealth of expertise and experience of both businesses. The Group’s management believes that the integration of NCC Group into Global Ports operations will be smooth and will enable the combined business to offer added value to the Groups customers.
Of the cash consideration of USD 291 million agreed at signing, the Group paid USD 229 million on completion of the acquisition. Payment of the remaining USD 62 million will be subject to, and to the extent that, Ilibrinio Establishment Limited and Polozio Enterprises Limited, the former owners of NCC Group (the Sellers) have procured no later than 1 January 2015 that the Eurogate loans to ULCT are converted into new ULCT shares issued to Eurogate5.
To finance the acquisition, the Group has raised USD 238 million under a secured term loan agreement. In addition, the terms for some of NCC Group’s existing debt portfolio have been renegotiated. As a result, the average interest rate of NCC Groups loan portfolio is expected to decrease creating synergies shortly after acquisition.
On completion of the Transaction on 27 December 2013 the Companys share capital was increased to 573,170,731 shares through an issue of additional 103,170,730 shares6 to the Sellers. The post-Transaction shareholder structure of the enlarged Global Ports is now as follows:
- N-Trans: 30.75%;
- APM Terminals: 30.75%;
- Free float: 20.5%;
- Ilibrinio Establishment Limited: 9%;
- Polozio Enterprises Limited: 9%.
In accordance with the Listing Rules, following completion of the Transaction, the Companys global depositary receipts (GDRs) in issue will be cancelled from the Official List and from admission to trading on the London Stock Exchange. Applications have been made to the UK Listing Authority and the London Stock Exchange for the readmission to listing on the standard segment of the Official List of the UK Listing Authority and to trading on the main market of the London Stock Exchange of up to 191,056,910 GDRs upon the cancellation of the current listing (together, Readmission). The Company expects that the cancellation and Readmission will occur nearly simultaneously at approximately 8:00 am on 30 December 2013.
Nikita Mishin, Chairman of Global Ports, commented:
” We are delighted to have completed such an important transaction, one that is an historic step for Global Ports, and which moves the Group into the big league of major global container terminal operators. Our combined group will hold an enviable position in the high-growth Russian container market and will have an unrivalled ability to provide the best quality of service to our customers. Over the next 12 months we will focus both on integrating NCC into our Group in order to realise the synergy potential of the Transaction as well as on the swift deleveraging of our balance sheet.”
Global Ports, December 30, 2013