Value of Cosco’s Noatum stake questioned

Drewry Financial Research Services stated in comparison to CSP’s terminal acquisitions in the past two years, its 51% stake in NPH appears a bargain at 14.5x EV/EBITDA, however, it believes the NPH deal may not be as fruitful as it appears.

Drewry said NPH carries €31.5m of goodwill at a discount rate of 7.9% and as the cost of equity is more expensive than debt, the change in capital structure will push WACC higher to the detriment of goodwill.

CSP is expected to consolidate NPH’s operations as it holds a majority stake in the company. The remaining 49% stake will be held by Turia, which has converted outstanding loans to equity.

Drewry commented: “We believe the lower IRR for NPH is indicative of management’s aggressive pursuit in Europe, especially with the latest Mediterranean terminal that has significant exposure to footloose cargoes.”

The largest port operator in China has an IRR target of about 10% for NPH, contingent on a 12-year concession renewal for NCTV beyond 2031.

CSP’s buy-in of NPH last month includes Valencia and Bilbao, as well as the dry ports of Madrid and Zaragoza/

Last year CSP paid EUR 125.4m for an equity stake in Euromax Container Terminal.