China Merchants increases stake as dredging begins on the controversial alternative route for super carriers
China Merchants International has struck a deal with rival Cosco Pacific, paying at least $610 million to increase its stake in the port of Shekou and gain management control of Shenzhen's No3 port by volume.
The surprising move for the rival blue chip's 17.5 per cent stake of Shekou Container Terminal (SCT) Phase I came as it emerged yesterday that Shenzhen had started dredging the Tonggu Channel, opening the port to round-the-clock servicing of world's biggest container vessels by 2007.
The deal, which will also see China Merchants absorb the undisclosed shareholder loans associated with the stake, gives it control of all three phases at SCT, or seven deep-sea berths by next year.
'This acquisition is a direct result of our consistent strategy to focus on our core port and port-related businesses,' chairman Fu Yuning said yesterday.
'Through this transaction, our company strengthened its leading position in western Shenzhen ports and enabled more efficient ... management [of] all our terminals.'