LONDON: Global Ports Holding announced that all conditions precedent to the sale of Ortadoğu Antalya Liman Işletmeleri (Port Akdeniz) to QTerminals W.L.L., including obtaining regulatory clearance and approval from relevant Turkish government authorities, have been satisfied and the transaction has now completed.
As previously announced, the agreed enterprise value for the sale was $140m, and the equity value for GPH after deducting net debt and debt-like items of Port Akdeniz as at closing is $115m.
The buyer will withhold $11.5m as a security for potential claims, which will be released in Q4-2021. From the proceeds received at closing after aforementioned retention GPH will pay transaction-related costs and expenses.
Pure play cruise port operator:
As a result of the disposal, GPH will become a more geographically diversified business, with Turkey representing a significantly reduced proportion of Group revenue going forward.
Revenue from Turkish assets represented 47.0% of Group revenue in the year ended 31 December 2019; following the disposal of Port Akdeniz, revenue from remaining Turkish assets represent c10% of 2019 pro-forma revenues.
The disposal also means that GPH will now effectively be a pure-play global cruise port operator. The GPH Board and senior management will now focus time and resources on the restart of cruise port operations during 2021 and continued expansion in the global cruise port market.
Notwithstanding current travel restrictions and uncertainty surrounding the return of meaningful global cruise activity, the Board of Global Ports Holding believes that the continued demand for cruising, as evidenced by healthy booking patterns reported by the major cruise lines for 2021 and beyond, supports the forecasted long term structural growth in cruise tourism.
Port of Adria:
As a result of the sale of Port Akdeniz and the effective creation of a pure-play cruise port operator, the board of Global Ports Holding is considering its options in regard to Port of Adria, the Group’s commercial port concession in Bar, Montenegro, including a potential disposal.
There can be no certainty as to the timing or that the terms of a sale will be agreed. A further announcement will be made when it is appropriate to do so.
Eurobond refinancing:
On 7 January 2021, GPH announced that its wholly owned subsidiary Global Liman İsletmeleri A.S. had published a refinancing proposal to the holders of its $250m 8.125% Senior Unsecured Notes due 2021. This proposal aims to address the upcoming maturity and provide the business with a more stable, deleveraged capital structure.
The sale’s successful closing is an essential element of the Group’s refinancing strategy for the Eurobond, with the net cash proceeds being used to fund a cash option to noteholders pursuant to the proposal. More information on the proposal to noteholders is available on the Investors section of Global Ports Holding’s website.
Global Ports Holding’s Chairman and Co-founder Mehmet Kutman said: “Port Akdeniz has played a pivotal role in the successful development of the Group over the years. However, it is now time for Port Akdeniz’s stewardship to pass to an organisation that I believe will prove to be an ideal home for the port and the employees in the years ahead.
The sale of Port Akdeniz effectively completes a key strategic ambition of the Group, creating a pure play cruise port operator. While this occurs during a period of unprecedented uncertainty for the global tourism industry, I firmly believe that the long-term fundamentals that make the cruise port industry such an exciting structural growth industry remain firmly in place.”
About Port Akdeniz: Port Akdeniz, operates Port Akdeniz-Antalya in Turkey, under a concession agreement which runs until August 2028. Port Akdeniz-Antalya is a leading commercial cargo export port in Turkey, currently specialising in handling cargo containers and general and bulk cargo destined for global markets including those in Asia and the Middle East.
In the year ended 31 December 2019, Port Akdeniz reported Container Throughput volumes of 150.9k TEU and General and Bulk cargo volumes of 589k tons, generating revenue of $47.5m and EBITDA of $37.4m, representing 40.3% of Group Revenue and 44.8% of Group Segmental EBITDA.
In the 9-month period ending 30 September 2020, Port Akdeniz reported revenues of $25.0m and EBITDA of $18.2m.
About QTerminals:
QTerminals is a terminal operating company jointly established by Mwani Qatar (51% shareholding) and Milaha (49% shareholding) to provide container, general cargo, RORO, livestock and offshore supply services in Phase 1 of Hamad Port, Qatar’s gateway to world trade. QTerminals is responsible for enabling Qatar’s imports and exports, its maritime trade flows and stimulating economic growth locally and regionally.
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