Fraser-Surrey Docks acquisition deal done

Massive Dubai-based port operator finalizes deal to acquire major Port of Vancouver multi-purpose terminal

The Port of Vancouver's Fraser Surrey Docks facility is the largest multi-purpose marine terminal on the West Coast of North America | Rob Kruyt

One of the world’s largest container terminal and port operators has completed the acquisition of Fraser Surrey Docks.

Dubai-based DP World began the process to buy the Port of Vancouver container and multi-purpose terminal last May from Macquarie Infrastructure Partners, a division of Australia-based international investment bank Macquarie Group.

The deal was done through subsidiary DP World Canada Investment Inc., which is 45% owned by Caisse de dépot et placement du Québec (CDPQ), one of North America’s largest pension fund managers.

DP World has not released the dollar value of the acquisition, but has noted that it was below 2.5% of its net asset value. 

In 2018, DP World generated profit of US$1.3 billion profit on US$5.6 billion in revenue. Its current market cap is approximately US$12 billion.

DP World operates the Fairview container terminal in Prince Rupert, the Centerm container terminal in Vancouver and the load-on/load-off short sea container terminal in Nanaimo.

Finalization of the Fraser Surrey Docks deal follows DP World’s decision to delist from the Nasdaq and return to private ownership.

Under the Nasdaq-delisting plan, DP World’s (Nasdaq Dubai:DPW) Port and Free Zone World corporate parent will acquire the 19.55% of DP World’s shares that are traded on Nasdaq Dubai.

In a press release, Matt Leech, CEO and Managing Director, DP World Americas, said the addition of Fraser Surrey provides DP World with “unique prospects for additional growth in the dynamic Canadian business environment.”

The company’s CEO, Sultan Ahmed Bin Sulayem, added that Fraser Surrey bolsters the company’s West Coast footprint.

“DP World has been seeing growing demand from our customers for multi-purpose facilities in the region, and we believe Fraser Surrey Docks has the relevant infrastructure and is in the right location to service this demand.”

Founded in 1962, Fraser Surrey Docks is now the largest multi-purpose marine terminal on the West Coast of North America.

The finalization of DP World’s Fraser Surrey acquisition comes at a difficult time for global shippers and major international shipping trade routes as fears over the spread of the COVID-19 coronavirus coupled with an already slowing global economy and heightened protectionism have rattle stock markets and further chilled economic outlooks.

Global container cargo trade growth in 2019 slowed to 1.4%, well below 2018’s 3.8%.

Maersk (CPH:MAERSK-B), the world’s largest container shipping company, noted in its recently release 2019 annual report that the outlook for 2020 “is subject to significant uncertainties and impacted by the current outbreak of the Coronavirus (COVID-19) in China, which has significantly lowered visibility on what to expect in 2020.”