Israeli shipping company Zim has said it will sell its 47.5 per cent stake in Nigeria’s Tin Can Island Container Terminal to a new joint venture between China Merchants Holdings and the China-Africa Development Fund for $154 million. Zim Integrated Shipping Services expects to make a gross profit of $120 million from the sale which will be completed in 2011.
Rafi Danieli, Zim’s chief executive said that the sale was in line with the company’s capacity expansion plans. “The proceeds from the sale would enable the company to develop and expand its shipping transportation activities in the international lines in Asia, North America and Europe.”
China Merchants is expected to own 60 per cent of the new venture while the China-Africa Development Fund will retain a 40 per cent stake after obtaining regulatory approval from the Chinese authorities. Zim will also sign an agreement to call at the terminal for the next ten years and sell additional rights in connection with the asset.
The TinCan Island container terminal is Nigeria’s second largest and has three berths with an annual capacity of 360,000 20-foot equivalent container units. A fourth berth which is being upgraded will increase the terminal’s capacity to 400,000 TEU per year.
Zim operates the terminal in partnership with Bollore Logistics Africa, a unit of Paris-based Group Bollore. Zim has extensive commercial activities in Nigeria and operates a number of shipping lines connecting Asia, Europe and the United States to Nigeria. It also owns a shipping and logistics agency.