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News

Doubled Capacity at Russian Port

01 Sep 2005

P&O Ports has reached agreement with joint venture partner Transportation Investment Holdings Limited (TIHL) to double the size of its port operations at Vostochny in Russia. Vostochny is located at the eastern end of the Trans Siberian Railway, which provides competitive transit times for cargo from Asia to Europe, the CIS countries and elsewhere in Russia.

P&O originally owned a 25% stake in Vostochny International Container Services (VICS) which holds a long term concession to operate two container berths with a capacity of 400,000teu. Following the transaction, P&O holds 25% of a new joint venture, Railfleet Holdings Limited (RHL) which in turn holds 100% of VICS and freehold rights to four container berths.

Total capacity of the four berths, comprising the current two berths operated by VICS and two adjacent berths, is estimated at 800,000 to 1 million teu when fully equipped. This capacity will be developed in line with demand which grew at a compound annual rate of 45% between 2000 and 2004.

P&O’s main joint venture partner TIHL is the major private company in the Russian transport services market and owns Russian transport companies Severstaltrans, Balttransservice, and New Forwarding Company. P&O paid its partner a cash consideration of £9m.

MJ Information No: 21034

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