Global Ports Investments, together with its subsidiaries and joint ventures, has entered into agreements to buy NCC Group for a consideration of $291m in cash and an 18% stake in the merged group.
The proposed acquisition of NCC Group, a major container terminals operator in Russia, is intended to strengthen Global Ports’ position in the Russian container market.
The merger will help shipping line customers benefit from network savings through improved call rationalisation, enhanced berth utilisation and improved productivity, according to Global Ports.
The acquisition affords Global Ports the potential for greater operational efficiency through enhanced terminal network management and a reduction in overhead costs, as well as the centralisation of support functions.
The combined group will have about 1.124 million TEU of available capacity to cater to throughput growth and reduce the company’s capital expenditure outlays for the next few years.
NCC Group’s container terminal operations are situated on the Baltic Sea, the main gateway for Russian container cargo.
The company’s primary assets include 100% ownership of First Container Terminal in St. Petersburg, an 80% stake in the Ust-Luga Container Terminal in the port of Ust-Luga and 100% ownership of Logistika-Terminal, an inland container terminal located close to St. Petersburg, which serves primarily as an inland container yard for First Container Terminal.
At the end of 2012, the annual container handling capacity of NCC’s marine terminals was nearly 1.69 million TEUs, which can be significantly expanded in response to market demand; its inland container facility has a capacity of 200,000 TEUs.
NCC Group generated revenues of $253m in 2012.
Global Ports board chairman Nikita Mishin said by acquiring NCC Group and bringing the two companies together, Global Ports is confirming its market leadership and creating a company with an "enviable" position in the high-growth Russian container market.
"NCC Group is not only considered to be one of the best container terminal operators in Russia and Eastern Europe, it is also highly profitable, with a track record of more than ten years of excellent performance," Mishin said.
The deal, which is subject to customary conditions, is expected to complete by the end of 2013.