On the same site, another angle on the PD Ports sale. Kendrew...

On the same site, another angle on the PD Ports sale. Kendrew makes a fine salesman.

PD Ports in sale talks
Port owner considers 'a number of unsolicited approaches' for stakes in the company
By Damian Brett

The owner of PD Ports has admitted several companies have made an approach to buy a stake in the UK port company.

The port owner and operator’s parent, Babcock and Brown Infrastructure (BBI), said it was engaged in "ongoing discussions" for the sale of PD Ports.

BBI CEO Jeff Kendrew said: "BBI confirms it is examining ways to optimise the capital structure at PD Ports both in terms of the debt structure and equity.

"We have received a number of unsolicited approaches from parties wishing to participate in the equity, which are being considered at this time."

But Kendrew said there was no certainty that any such interest would be "at a level that delivers more value than retaining outright or partial ownership".

Kendrew also revealed that over the last six months volumes at PD Ports-owned Teesport had dropped because of weaker demand for cars, containers and oil, and revenues were down by around 9%.

He said this was caused by the "current economic conditions" in the UK. He added BBI had poor visibility on customer outlook making it difficult to predict the length and depth of the recession and its impact on PD Ports.

"Despite a softening in volumes through Teesport and poor visibility as to selected customer outlook, the fundamentals of its geographic positioning and diversity of products through it, make this an attractive asset with a good mixture of container and bulk product exposure, " he said.

Kendrew said BBI believed PD Ports would trade strongly on the recovery, and sources said the parent company remains "very committed" to PD Ports.

A PD Ports spokeswoman refused to comment on a potential sale but said PD Ports’ plan to build a £300m (US$425m) 1.5m teu container terminal at Teesport had been delayed by 12 months until 2013.

IFW understands this is more to do with a current lack of demand and uncertainty over when demand might pick up, rather than the potential sale.

Sources said the current financial markets contributed to the delay, which were making it extremely difficult to raise the levels of capital required.

BBI also announced that £75m worth of PD Ports debt had been refinanced in January for a further six months until July.

Over the last year, BBI has sold a 29.7% share of its Euroports portfolio - which operates facilities and businesses in Belgium, France, Germany, Spain, Finland, Bulgaria and Italy - and its share price has fallen by 95%.

Posted: 06-03-2009