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United Arab Emirates's Dubai Ports World, will be the operator of the largest private multi-modal terminal in Brazil, to be built in Santos Port, on the coast of the state of São Paulo. in southeastern Brazil. The company announced the acquisition, together with Odebrecht, of majority stake in the Empresa Brasileira de Terminais Portuários.
Embraport, the Brazilian Port Terminal Company, is responsible for the project, up to now controlled by Coimex Group, which includes the trading company that goes by the same name.
"We want it not only to be the greatest, but also the best and most competitive terminal in the country," said Coimex vice president Orlando Machado Júnior.
With the agreement, DP World and Odebrecht have 51.4% of the business, Coimex has 15.3% and the remains belongs to the FGTS Investment Fund (FI-FGTS), under the Federal Savings Bank, which acquired a stake in the project in October last year.
According to Machado, the project, thought up in 1998, obtained all necessary licensing, which took eight years, but the works have not yet started. Embraport is awaiting the liberation of financing requested from the Brazilian Development Bank (BNDES) and the Inter-American Development Bank (IDB).
He hopes that this should take place by the end of the year so that the construction may start, at the latest, in early 2010. "The first quarter of this year was very bad, financing was hard to come by and financial institutions disappeared," said the executive, referring to the international financial crisis.
"Now the situation has been changing, the market is improving and financial institutions are returning [to offering credit]," he added.
The value of the project is 1.1 billion Brazilian reais (US$ 583 million), originating 70% from financing and 30% from Embraport capital. According to Machado, the search for new partners did not have the objective of facilitating the access to credit, but he recognizes that the arrival of the two new heavyweight partners grants greater strength to the project.
"We had already made the decision of seeking an operating partner and Odebrecht came in the package, which was a good surprise. The financing did not depend on that alone, but it is obvious that the entry of two companies of this size is an enormous contribution to the project in all points of view," said the executive.
According to him, DP World should add to the business the know-how of a company that manages 49 port terminals worldwide, including in South America. Odebrecht, in turn, has great experience in the sector of infrastructure. The contractor, even before becoming a partner, already led the consortium responsible for the construction of the enterprise in Santos. The process for selection of the new partners began in early 2009 and was managed by bank Credit Suisse.
Machado added that the terminal was thought up to expand the capacity of Santos Port, which is the largest and busiest in the country, especially with regard to container movement and ethanol. "It should play the part of a catalyst for development, as both areas currently have significant bottlenecks," he said.
Apart from supplying the foreign trade demand in general, Embraport should serve the Odebrecht and Coimex business. The former plans to use the terminal for the outflow of products of subsidiaries like Braskem, in the petrochemical industry, and ETH, in sugar and alcohol. Trading Coimex should use it for the transportation of agricultural commodities.
The start of operations is forecasted for 2012, with a capacity for throughput of one million twenty-foot equivalent units (TEUs) a year. When the project is completed, in 2014, the annual capacity should reach 1.5 million containers and around 2 billion liters of ethanol. The site should have railway and road access and a capacity to receive vessels of up to 330 meters in length.
This is not the first project in which DP World and Odebrecht operate in partnership. The Brazilian construction company has already built a terminal for the Arab organization in Djibouti, on the east coast of Africa, and is building another in Callao, Peru.
"This is an unparalleled opportunity to enter Latin America’s largest economy and establish a strong position on the east coast [of South America], building on the network we already have in the region to expand our offering to our customers," said Mohammed Sharaf, CEO of DP World, according to a company press statement.
Anba
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