27 Dec 2013 16:10
For immediate release 27 December 2013
Global Ports Investments PLC
Completion of acquisition of NCC Group
Global Ports Investments PLC ("Global Ports" or the "Company", together with its subsidiaries and joint ventures, the "Group"; LSE ticker: GLPR) announces that the Group has today completed the acquisition of 100% of the share capital of NCC Group Limited (together with its subsidiaries, "NCC Group"), in a transaction which was announced on 2 September 2013 (the "Transaction").
The acquisition of NCC Group, the second largest container terminals operator in Russia[1], strengthens Global Ports' leading position in the growing Russian container market. The enlarged Global Ports ("Enlarged Group") will operate nine container terminals[2], with a total marine container handling capacity of approximately 4 million TEUs (as of 30 June 2013), located in both the Baltic Sea and Far East Basins which are key gateways for Russian container cargo. The Enlarged Group is now the largest container terminal operator in Eastern Europe and one of the top-20 container operators globally[3].
The Transaction provides potential for greater operational efficiency through improved terminal network management. The combination of NCC Group and Global Ports will enable shipping line customers to benefit from network savings through improved call rationalisation, better berth utilisation and enhanced productivity. The Transaction creates a basis for the Enlarged Group to reduce overhead costs as well as to centralise support functions. The Enlarged Group will have approximately 1.12 million[4] TEUs of available capacity enabling it to accommodate future throughput growth while reducing the Group's capital expenditure.
Global Ports has elaborated a detailed plan for the integration of NCC Group based on applying best practices and leveraging the wealth of expertise and experience of both businesses. The Group's management believes that the integration of NCC Group into Global Ports' operations will be smooth and will enable the combined business to offer added value to the Group's customers.
Of the cash consideration of USD 291 million agreed at signing, the Group paid USD 229 million on completion of the acquisition. Payment of the remaining USD 62 million will be subject to, and to the extent that, Ilibrinio Establishment Limited and Polozio Enterprises Limited, the former owners of NCC Group (the "Sellers") have procured no later than 1 January 2015 that the Eurogate loans to ULCT are converted into new ULCT shares issued to Eurogate[5].
To finance the acquisition, the Group has raised USD 238 million under a secured term loan agreement. In addition, the terms for some of NCC Group's existing debt portfolio have been renegotiated. As a result, the average interest rate of NCC Group's loan portfolio is expected to decrease creating synergies shortly after acquisition.
On completion of the Transaction on 27 December 2013 the Company's share capital was increased to 573,170,731 shares through an issue of additional 103,170,730 shares[6] to the Sellers. The post-Transaction shareholder structure of the enlarged Global Ports is now as follows:
· N-Trans: 30.75%;
· APM Terminals: 30.75%;
· Free float: 20.5%;
· Ilibrinio Establishment Limited: 9%;
· Polozio Enterprises Limited: 9%.
In accordance with the Listing Rules, following completion of the Transaction, the Company's global depositary receipts ("GDRs") in issue will be cancelled from the Official List and from admission to trading on the London Stock Exchange. Applications have been made to the UK Listing Authority and the London Stock Exchange for the readmission to listing on the standard segment of the Official List of the UK Listing Authority and to trading on the main market of the London Stock Exchange of up to 191,056,910 GDRs upon the cancellation of the current listing (together, "Readmission"). The Company expects that the cancellation and Readmission will occur nearly simultaneously at approximately 8:00 am on 30 December 2013.
Nikita Mishin, Chairman of Global Ports, commented:
"We are delighted to have completed such an important transaction, one that is an historic step for Global Ports, and which moves the Group into the 'big league' of major global container terminal operators. Our combined group will hold an enviable position in the high-growth Russian container market and will have an unrivalled ability to provide the best quality of service to our customers. Over the next 12 months we will focus both on integrating NCC into our Group in order to realise the synergy potential of the Transaction as well as on the swift deleveraging of our balance sheet."
ENQUIRIES
Global Ports Investor Relations
Mikhail Grigoriev
+357 25 503 163
Email: ir@globalports.com
Global Ports Media Relations
Anna Vostrukhova
+357 25 503 163
E-mail: media@globalports.com
StockWell Communications
Laura Gilbert/ Zoe Watt
+44 20 7240 2486
E-mail: globalports@stockwellgroup.com.
NOTES TO EDITORS
Global Ports
Global Ports Investments PLC is the leading operator of container terminals in the Russian market.
Global Ports' terminals are located in the Baltic and Far East Basins, key regions for foreign trade cargo flows. Global Ports operates five container terminals in Russia (Petrolesport, First Container Terminal, Ust-Luga Container Terminal and Moby Dik in St. Petersburg and Ust-Luga port cluster, Vostochnaya Stevedoring Company in the Vostochny Port) and two container terminals in Finland (Multi-Link Terminals Helsinki and Multi-Link Terminals Kotka). Global Ports Group also owns 75% in Yanino Logistics Park and 100% of inland Logistika-Terminal, both located in the vicinity of St. Petersburg, and a 50% share in the major oil product terminal, AS Vopak E.O.S., in Estonia.
Excluding NCC Group, Global Ports' consolidated revenue[7] for the first six months of 2013 was USD 249.1 million. Adjusted EBITDA[8] for the first six months of 2013 was USD 137.7 million. The Russian Ports segment had a total container throughput of approximately 707 thousand TEUs in the first six months of 2013 (excluding Yanino).
Immediately following completion of the Transaction, Global Ports' major shareholders are Transportation Investments Holding Limited (operating under the brand name of N-Trans), one of the largest private transportation and infrastructure groups in Russia (30.75%), and APM Terminals B.V., whose core expertise is the design, construction, management and operation of ports, terminals and inland services with a global terminal network of 64 operating port facilities and 165 Inland Services operations, giving APM Terminals a global presence in 68 countries (30.75%). 20.5% of Global Ports shares are in public hands and held in the form of global depositary receipts listed on the Main Market of the London Stock Exchange (LSE ticker: GLPR). Each of Ilibrinio Establishment Limited and Polozio Enterprises Limited (former owners of NCC Group) own 9% of the share capital of Global Ports.
For more information please see: www.globalports.com
NCC Group
NCC Group Limited was founded in 2002 and, together with its subsidiaries, was the second largest container terminal operator in Russia, by gross container throughput in 2012, according to ASOP. Its key assets include 100% of the First Container Terminal in St. Petersburg, 80% of the recently launched Ust-Luga Container Terminal in the port of Ust-Luga and 100% of Logistika-Terminal ("LT"), an inland container terminal close to St. Petersburg. NCC Group's container terminal operations are located on the Baltic Sea, one of the key gateways for Russian container cargo. NCC Group's marine terminals had an annual container handling capacity of approximately 1.69 million TEUs and have the potential to be expanded to accommodate increases in demand for container handling services in the Baltic region of Russia. The annual capacity of NCC Group's inland container facility, LT, currently amounts to 200 thousand TEUs.
NCC Group's marine container terminals had a total container throughput of approximately 1,069 thousand TEUs in 2012. In the first six months of 2013, NCC Group's marine terminals handled approximately 561 thousand TEUs, which represented growth of approximately 6.5% compared to the first six months of 2012.
In the first six months of 2013, NCC Group's consolidated revenue and Adjusted EBITDA[9] were USD 131,801 thousand and USD 84,749 thousand, respectively.
LEGAL DISCLAIMER
Some of the information in these materials may contain projections or other forward-looking statements regarding future events or the future financial performance of the Global Ports Group. You can identify forward looking statements by terms such as "expect", "believe", "anticipate", "estimate", "intend", "will", "could," "may" or "might" or the negative of such terms or other similar expressions. The Global Ports Group wishes to caution you that these statements are only predictions and that actual events or results may differ materially. The Global Ports Group does not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in projections or forward-looking statements of the Global Ports Group, including, among others, general economic conditions, the competitive environment, risks associated with operating in Russia and market change in the industries the Global Ports Group operates in, as well as many other risks specifically related to the Global Ports Group and its operations, including the completion of the acquisition of the NCC Group and its ability to realise the benefits of that acquisition.
[1] By gross container throughput for 2012, according to the Association of Sea Commercial Ports ("ASOP").
[2] Including two inland container terminals.
[3] By 2012 container throughput according to Drewry data.
[4] Calculated as the NCC Group's and the Group's Russian marine terminals' container handling capacity as of 31 December 2012 less combined Russian maritime container throughput in 2012.
[5] NCC Group controls 80% of ULCT. The remainder is controlled by the international container terminal operator, Eurogate. As of 30 June 2013, the amount of ULCT's indebtedness under loans from Eurogate was USD55,466 thousand
[6] 50% of these shares are in the form of GDRs and the other 50% are ordinary shares
[7]According to the interim condensed consolidated financial information of Global Ports as at and for the six months ended 30 June 2013.
[8] Adjusted EBITDA in respect of Global Ports is defined as profit for the period before income tax expense, finance costs, finance income, depreciation of property, plant and equipment, amortisation of intangible assets, other gains/(losses)-net, impairment charge of property, plant and equipment and impairment charge of goodwill.
[9] Adjusted EBITDA in respect of the NCC Group is defined as profit for the period before income tax expense, foreign exchange gains/(loss), net, finance costs, finance income and depreciation and amortisation expenses adjusted further certain non-cash or one-off gains and losses included within other income/(expenses), net in Note 8 to each of the audited consolidated financial statements of the NCC Group as at and for the years ended 31 December 2010, 2011 and 2012 and the unaudited interim condensed consolidated financial information of the NCC Group as at and for the six month period ended 30 June 2013.