Bidder selected for Durban Container Terminal upgrade.
Manila-based International Container Terminal Services (ICTSI) has been selected by Transnet as the preferred bidder for a joint venture to develop and modernize the Durban Container Terminal Terminal 2.
Over a period of 25 years, ICTSI will partner with Transnet Port Terminals (TPT) to develop and modernize Transnet’s largest container terminal, handling 72% of Durban’s port throughput and 46% of port traffic in South Africa.
Transnet said on Monday that the completion of the process follows approvals from the government regarding the Public Financial Management Act (PFMA).
“Private sector participation in Pier 2 is a key catalyst for repositioning Durban Port as a container hub port,” said Portia Derby, CEO of Transnet Group. “We are delighted to have a global player of ICTSI’s stature on board to lead this process.”
The partnership with ICTSI will help relocate the terminal to perform best practices, ensure volume throughput growth, and support the terminal in providing operational and commercial support to access global shipping line call routes.
This will not only improve the logistics associated with servicing South African ports, but will play an important role in stimulating exports and imports.
Transnet plans to increase Pier 2’s current capacity of 2 million TEU (20 TEU) to 2.8 million TEU.
This is in line with plans by Transnet National Port Authority (TNPA) to increase the current container capacity in the entire Port of Durban from 3.3 million TEUs to an eventual projected capacity of 11.4 million TEUs.
“The Pier 2 partnership is a huge step forward for our program to bring global expertise to improve efficiencies at our terminals, and bodes well for our continued plans to crowd in the private sector in the areas identified for growth,” said Derby.
ICTSI is a publicly listed company and is a leading independent global developer and operator of container terminals, which operates 34 terminal operations in 20 countries across six continents.
A total of 18 responses were received to Transnet’s initial call for the request of interest and a total of 10 bids were shortlisted in response to the request for qualifications. Among the selected respondents, six bidders submitted proposals.
In connection with the transaction, a new company will be formed to manage the operations of Pier 2, in which Transnet will have a 50% majority ownership plus one share. Pier 2 staff will be seconded to the new entity and will maintain the same terms and conditions before and after the introduction of the private sector partner.