Monday, September 18, 2017

DP World Acquires Maritime World and Drydocks World

Will Pay Out 405 Million Dollars for Ship Repairer and Dubai Maritime City
Shipping News Feature
DUBAI – DP World has agreed to buy two fellow state-owned maritime entities for a total cash consideration of US$405 million. The global port operator has said that it will acquire Maritime World, the owner of Dubai Maritime City (DMC), for $180 million, and purchase Drydocks World by means of a capital injection of $225 million, from state-owned Dubai World.

DMC, a maritime service facility and industrial business zone, is located in central Dubai, adjacent to DP World’s Port Rashid. It is a maritime focused commercial and industrial park, which extends to 2.3 million square metres on a man-made peninsula and provides Economic Zones World FZE additional land as an alternative to the highly-occupied Jebel Ali Free Zone.

Drydocks World, a ship repair business with the largest ship repair yard in the Middle East, delivers stable ship and rig repair revenues and has specialist capabilities in niche ship new builds and conversions. Drydocks’ acquisition will integrate well into P&O Maritime (POM), which is DP World’s 100% owned maritime services subsidiary.

While both acquisitions are subject to certain conditions, the acquisition of Drydocks World is subject to the successful completion of its debt restructuring process. Drydocks is nearing a deal with creditors to amend the terms of its $2.3 billion debt restructuring deal signed in 2012, after it was hit by the global financial crisis. Both transactions are expected to close before the end of the first quarter of 2018. Commenting on the acquisitions, Sultan Ahmed Bin Sulayem, DP World Group Chairman and CEO, said:

“We are delighted to make these acquisitions which further strengthen the Group’s maritime services and port related businesses. As a global trade enabler, we have been targeting a broader strategy to grow complementary sectors in the global supply chain such as industrial parks, free zones and logistics adding further value for all our stakeholders.

“Dubai Maritime City provides us with stable leasing income from DMC’s existing industrial zone and spare capacity to develop industrial and commercial activities for the maritime sector in a prime location of Dubai. We aim to develop the best-in class Maritime City serving the needs of the maritime industry and leveraging on our expertise and experience from our ownership of the Jebel Ali Free Zone. We are consequently well positioned to deliver significant value in the medium term.

“Drydocks World bolsters our investment in the maritime sector through our subsidiary P&O Maritime. We are acquiring a market leader in the Middle East with the potential to deliver near term synergies and new revenue opportunities over the longer term, particularly in ship conversion and in areas where POM has existing expertise. We remain excited about the growth prospects of this business.

“Overall, these transactions will enhance our position as a leading maritime services provider, and we look forward to leveraging on our proven track record to accelerate growth and deliver stakeholder value.”