China Merchants, COSCO and CIC Capital acquire Turkish terminal

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China Merchants, COSCO and CIC Capital acquire Turkish terminal

China Merchants Holdings International (CMHI), COSCO Pacific and CIC Capital have acquired Turkish port terminal Kumport.

The team will have an equity interest of 65% in Kumport upon the completion of the acquisition, at a consideration of US$940 million, with the remaining 35% equity interests held by State General Reserve Fund in Oman. CMHI, COSCO Pacific and CIC Capital will have equity stakes of 40%, 40% and 20% in the Tripartite Consortium, respectively.

The 6-berth terminal currently has a shoreline of 2,180 m and maximum water depth of 16.5 m, which is capable of accommodating the world's largest container vessels currently. The container handling capacity of the terminal is 1.84 million TEUs at the moment, which can potentially be expanded to 3.5 million TEUs.

In 2014, Kumport handled a total container throughput of 1.414 million TEUs, accounting for 17% of the country's total, and with the compound annual growth rate exceeding 30% between 2009 and 2014.

Kumport is the third largest container terminal in Turkey and is located within the Ambarli Port Zone on the northwest Marmara Sea, which is on the European side of Istanbul, the capital of Turkey, and an important strategic location at the junction in the Eurasian region. The terminal is only 35 km away from the Bosphorus Strait, , a gateway to the Black Sea region where all routes into the Black Sea must pass through.

Mr. Li Jianhong, Chairman of Board of Directors of CMHI, said:

"With the  promising economic prospects of Turkey, the hinterland of Kumport, its position as an important node situated along both the Silk Road Economic Belt and the 21st Century Maritime Silk Road, and with the Chinese government's pursuance of the One Belt, One Road initiative, strong growth potential for demand of container ports and logistics services is expected in the future."

"In addition, the acquisition will further enhance the company's global port network layout and create synergies with other terminals within the company's port portfolio, which is in line with the company's overall development strategy. Kumport, with its competitive market position, will generate stable financial returns for the company, while the company's experience and expertise in the terminal business would complement the services currently being offered by the other shipping companies operating at Kumport, thereby expanding the client base and increasing the market share of the Kumport."

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