AD Ports to buy majority stake in Egypt's Transmar & Transcargo Intl
Investment extends AD Ports Group’s presence in the Red Sea container, cargo and port operations.
AD Ports Group has agreed to acquire a 70 percent equity stake in International Associated Cargo Carrier B.V., which wholly owns two Egypt-based maritime companies Transmar International Shipping Company (Transmar) and Transcargo International S.A.E. (TCI). This the first international acquisition finalised y AD Ports Group.
"The total purchase consideration (enterprise value) of this transaction amounts to AED 514 million ($140 million)," according to a statement from AD Ports.
The acquisition will be fully funded from AD Ports Group's existing cash reserves, which stood at over AED 3 billion (approximately $810 million) as of March 31, 2022, the statement added.
Transmar is a regional container shipping company that operates across the Middle East, Red Sea, Arabian Gulf and Eastern Coast of Africa. In 2021, Transmar handled 109,000 TEUs.
"TCI is a terminal operator and stevedoring company, mainly operating out of the Adabiya Port, where it is the exclusive container operator. Its two lines of business are container and bulk cargo services. In 2021, TCI handled 92,500 TEUs and 1.2 million tonnes of bulk cargos."
Together, Transmar and TCI reported last twelve months (LTM) revenue and EBITDA of AED 325 million ($88 million) and AED 108 million ($29 million), respectively.
"For full-year 2022, management is on track to deliver triple-digit growth year-on-year driven by both volume and rate increases. These synergistic and value-accretive acquisitions provide AD Ports Group with a market-leading platform for further growth opportunities in Egypt, but also in the entire Red Sea and Gulf regions."
The El Ahwal family and their executive team will remain in management of the companies, the statement said.
"This is the first overseas acquisition in AD Ports Group's history, and an important milestone in our ambitious international expansion plan," says Falah Mohammed Al Ahbabi, Chairman, AD Ports Group. "This acquisition will support our wider growth targets for North Africa and the Gulf region and broaden the portfolio of services we are able to offer in those markets.
"AD Ports Group continues to diversify and take bold steps to expand our reach around the world, in line with the vision and guidance of our wise leadership. We look forward to working with the two new Egypt-based operations and bringing them into the AD Ports Group family."
Captain Mohamed Juma Al Shamisi, Managing Director and Group CEO, AD Ports Group, adds: "AD Ports Group continues to build up our presence in Egypt as part of our wider strategy for global expansion. The acquisition of Transmar and TCI, which both have strong regional presences and deep client relationships, is another key step in increasing our geographical footprint and bringing the benefits of our integrated portfolio of services to more customers. Egypt and the Red Sea coast are increasingly important parts of our global maritime offering, and we believe we are well-placed, thanks to the guidance and continuous support of our wise leadership, to boost trade and economic growth for customers and communities along these routes."
This deal is the latest in a series by AD Ports Group in the Egyptian maritime industry including agreements for the joint development and operation of Ain Sokhna Port and an agreement with the General Authority for Red Sea Ports for the development, operation and management of cruise ship berths at Sharm El Sheikh Port, the statement said.