DP World sells Australian asset for $1.5 billion
DP World, the world’s third-largest port operator, has agreed a deal to sell 75 percent of its Australian operating arm to Citi Infrastructure Investors for $1.5 billion.
The state-backed firm has said that proceeds will go to reducing net debt, in a statement to the Nasdaq Dubai.
DP World will continue to provide management services at the five terminals in Australia under the terms of the deal, which is expected to be completed by the end of the first quarter of 2011.
“This strategic partnership provides a great opportunity for DP World to remain actively involved in Australia whilst delivering on our strategy to monetise assets as part of DP World’s ongoing goal to reduce leverage and focus on higher margin markets,” said DP World chief financial officer Yuvraj Narayan.
“This transaction, including the benefits of the long-term management contract, will be earnings accretive for DP World from the time of completion.”
The transaction values DP World Australia with an enterprise value of $1.8bn.
In 2009, equity adjusted earnings before interest, tax, depreciation and amortisation at the outfit amounted to $96m.