DP World buys P&O Ferries for almost half a billion ahead of Brexit boom
DP World has acquired the holding company of P&O Ferries and P&O Ferrymasters (together P&O Ferries) for US $421-million, giving it sole ownership of one of the UK’s best-known logistics brands.
P&O Ferries is a pan-European integrated logistics business based in Dover. It operates a roll-on roll-off (Ro-Ro) ferries service and a European transportation and logistics solution called P&O Ferrymasters.
P&O Ferries operates a fleet of 21 vessels on the Short Sea, North Sea and Irish Sea sectors across 11 ports whilst P&O Ferrymasters provides supply chain solutions in 19 European cities.
P&O Ferries handles over 2.5mn freight units per year which accounts for approximately 75% of group revenues.
It reported revenues of US $1.4-billion in 2017 and is expected to see immense demand for its services in the event of a hard Brexit.
The ferry operator re-flagged its entire fleet to Cyprus in January to avoid any disruption in services due to the ongoing Brexit uncertainty.
Brexit is the name given to the process of the UK leaving the EU, the country is due to leave the trade and customs bloc on March 29th, 2019.
Brexit is expected to create a major shortage of ferry operations between the UK and EU and the British government is spending more than US $100-million on charter contracts with various operators to ease anticipated congestion.
The acquisition is subject to customary completion conditions and is expected to close in the first half of 2019.
As the acquisition is considered a related party transaction under the DFSA Market Rules, DP World will comply with the relevant requirements of DFSA Market Rule 3.5.3.
“We are pleased to announce the return of P&O Ferries back into the DP World family. P&O Ferries is a strong, recognisable brand and adds a best-in-class integrated logistics provider into our global portfolio,” said Sultan Ahmed Bin Sulayem, group chairman and CEO, DP World.
“Importantly, P&O Ferries provides efficient European freight connectivity building on last year’s acquisition of Unifeeder. This transaction is in line with our strategy to grow in complementary sectors, strengthen our product offering and play a wider role in the global supply chain as a trade enabler,” he added.
The takeover of P&O Ferries comes four year after DP World acquired the right to the P&O Ports brand, which it launched as a subsidiary focusing on the operation of smaller container ports in North Africa.