A CMHI-Involved Tripartite Consortium Agreed to Acquire 65% Equity Interests in Kumport Terminal in Turkey

China Merchants Holdings (International) Company Limited (¡°CMHI¡± or the ¡°Company¡±, HKSE Code: 0144) is pleased to announce the entering into of a sale and purchase agreement on [16] September 2015 between Fina Holding A.S. and its individual shareholders, and a Luxembourg-registered joint venture (the ¡°Tripartite Consortium¡±) formed between the Company, COSCO Pacific Limited (¡°COSCO Pacific¡±) and CIC Capital Corporation (¡°CIC Capital¡±). The Tripartite Consortium will have an equity interest of 65% in Kumport upon the completion of the acquisition, at a consideration of USD940 million, with the remaining 35% equity interests held by State General Reserve Fund in Oman. CMHI, COSCO Pacific and CIC Capital will have equity stakes of 40%, 40% and 20% in the Tripartite Consortium, respectively.

Kumport is the third largest container terminal in Turkey and is located within the Ambarli Port Zone on the northwest Marmara Sea, which is on the European side of Istanbul, the capital of Turkey, and an important strategic location at the junction in the Eurasian region. The terminal is only 35 km away from the Bosphorus Strait, , a gateway to the Black Sea region where all routes into the Black Sea must pass through. The 6-berth terminal currently has a shoreline of 2,180 metres and maximum water depth of 16.5 metres, which is capable of accommodating the world¡¯s largest container vessels currently. The container handling capacity of the terminal is 1.84 million TEUs at the moment, which can potentially be expanded to 3.5 million TEUs. In 2014, Kumport handled a total container throughput of 1.414 million TEUs, accounting for 17% of the country¡¯s total, and with the compound annual growth rate exceeding 30% between 2009 and 2014.

Mr. Li Jianhong, Chairman of Board of Directors of CMHI, said: ¡°With the  promising economic prospects of Turkey, the hinterland of Kumport, its position as an important node situated along both the ¡°Silk Road Economic Belt¡± and the ¡°21st Century Maritime Silk Road¡±, and with the Chinese government¡¯s pursuance of the ¡°One Belt, One Road¡± initiative, strong growth potential for demand of container ports and logistics services is expected in the future. In addition, the acquisition will further enhance the Company¡¯s global port network layout and create synergies with other terminals within the Company¡¯s port portfolio, which is in line with the Company¡¯s overall development strategy. Kumport, with its competitive market position, will generate stable financial returns for the Company, while the Company¡¯s experience and expertise in the terminal business would complement the services currently being offered by the other shipping companies operating at Kumport, thereby expanding the client base and increasing the market share of the Kumport.¡±

CMHI, COSCO Pacific and their respective parents have strong capabilities and extensive resources in the terminal, shipping and logistics arena. In particular, China Merchants Group Limited (¡°CMG¡±), the parent company of CMHI, is a Hong Kong-registered Chinese conglomerate with a history of more than 100 years and extensive experience in ports, highways, energy transportations and logistics operations. China Ocean Shipping (Group) Company, the parent of COSCO Pacific, is China¡¯s largest and the world¡¯s second largest shipping enterprise, with its shipping routes covering more than 1,500 ports in more than 160 countries and regions in the world. CIC Capital is the direct investment arm of China Investment Corporation (¡°CIC¡±). CIC, China¡¯s sovereign wealth fund, was established as a vehicle to diversify China's foreign exchange holdings and seek maximum returns for its shareholder within acceptable risk tolerance.

Mr. Li Jianhong indicated: ¡°The formation of the Tripartite Consortium among these Chinese enterprises with respective competitive strengths will reinforce strategic cooperation among all parties involved, thus creating a solid foundation for all parties to further explore cooperation opportunities that are mutually beneficial. I believe that Kumport, Turkish foreign trade and its economic activities, as well as all parties involved will be benefited through this cooperation.¡±

For details of the aforesaid transaction, please refer to the announcement published on the web site of the Company (www.cmhi.com.hk).



 
 

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