Friday, May 4, 2012

Express Freight and Road Haulage Firm Sinks as Container Port Plan Emerges

1000 Australian Drivers and Warehousemen Laid Off Whilst Expansion Plans for Sydney Forge Ahead
Shipping News Feature

AUSTRALIA – Staff were left stunned this week as 1st Fleet, a major express freight and warehousing company based in New South Wales shut its doors following its recent descent into administration. Meanwhile more hopeful news as Asciano announced that it would be expanding its Port Botany container terminal after agreeing plans with the Sydney Ports Corporation.

The 1st Fleet collapse came about following the withdrawal of credit by the company’s main bankers and staff were shut out on Tuesday night by security staff apparently put in place by administrator’s deVriesTayeh which announced further trading was impossible. The company’s warehouses are stocked with freight belonging to numerous customers who will no doubt be annoyed at the interruption to their trade, not as upset however as the 600 or so permanent staff employed by 1st Fleet or the 400 sub contractors who are undoubtedly owed money by the company.

The container handling side was established in 1975 and trading originally as Aeroflex subsequently changing its name to Sydney Transport in 2001 the company became a dominant service provider to national and Sydney waterfronts. 1stFleet was formed in 1988 and grew by acquisition and as client demand for container services grew acquired Sydney Transport in April 2007.

Cynics will doubtless say that the foreclosure by a major bank, Coface, reflects the attitude displayed so often by financiers in these situations when, having seen administration just a week or so ago, they have decided to cut their losses and exercise the chance to ensure they recover all their money before other creditors can object.

In better Sydney news Asciano says it will develop an integrated facility at Port Botany combining its Patrick Container Terminal with the adjoining site known as ‘The Knuckle’ which at over seventeen hectares will allow the group to expand capacity to 2.5 million TEU’s per annum and will include an expansion of quay line to 1400m, with four berths capable of accommodating the new panamax vessels. Asciano Chief Executive John Mullen was plainly delighted by the news of the successful negotiation for a new lease between the Ports authority and Patrick saying:

“We are pleased to reach an agreement with Sydney Ports Corporation which delivers the certainty and flexibility to develop an operation that is both productive and competitive with similar size container ports around the world, which will ultimately benefit our customers. The agreement is a significant testament to both Sydney Ports Corporation and our management teams and their commitment to see these negotiations through to a productive outcome.”

Sydney Ports Corporation CEO and Director Grant Gilfillan said that once Patrick has met its development obligations, which include an agreed minimum amount of capital expenditure, Sydney Ports Corporation will grant the long term lease to the end of June 2043 for the combined site adding:

“As one of the largest port projects to be undertaken in Australia in the last 30 years, we look forward to working with Patrick to deliver increased capacity which caters for long term trade growth.”

The news comes shortly after Asciano agreed to a new contract with Danish container giant Maersk Line. The deal encompasses the movement of existing volume, approximately 503,000 containers in 2011, combined with an additional pro forma 190,000 containers per annum. Patrick has ordered a total of five new cranes for its container terminals to be delivered over the next eighteen months which it says will hasten throughput and improve services.

A video of the billion dollar expansion at Port Botany can be seen HERE.