The jewels in the crown of Bollore\u2019s African Logistics assets are sixteen container terminals with, in all, Bollore present in 42 African ports, although not always in a cargo handling capacity. A number of the container terminals, most of which are operated under concession, involve a partnership with another entity and notably APM Terminals. This is the case in Abidjan, for example, where Bollore and APMT operate the existing container terminal and are now pressing ahead with the construction of an adjacent second terminal. Similarly, they are partners in the Port of Pointe Noire, Congo-Brazzaville container terminal. Indeed, it is surprising given this relationship that APMT did not secure a period of exclusivity to look at the deal.<\/p>\n
The same could be said of liner operator CMA CGM, which enjoys a French connection with Bollore and also has terminal operating assets in its group as well as strong African lineage.<\/p>\n
The fact that so far it is MSC in pole position inevitably comes to down to money \u2013 in all likelihood the MSC bid came out tops in an indicative bid process and hence the award of exclusivity. It will be interesting to see if at the end of the due diligence process the bid level remains the same and the deal confirmed. Presumably, what can be called the auction stage of the bid process is over and there is little scope for gazumping to take place. But you never know\u2026money talks!<\/p>\n
Informed sources indicate that APMT and CMA CGM did express interest, both of course already have a strong involvement in Africa through liner shipping and in APMT\u2019s case via both shipping and an existing large network of African terminals including those where it has joint ventures with Bollore. For both these companies, and of course for MSC also with a strong presence in Africa, a purchase offers the sizable benefits of synergies with their existing operations and generally the ability to scale up, in one step, at an unprecedented level.<\/p>\n
MSC\u2019s exclusivity is perhaps a result of \u201cfortune favours the brave,\u201d a willingness to field a knock-out bid where others might not be so inclined. It is a strategy that has worked before with terminal acquisitions. APMT showed such a willingness back in 2006 when it secured the Apapa Container Terminal concession with a mega offering compared to those of other bidders. Equally, DP World bid very strongly for the P&O Ports global portfolio of terminals and enjoyed a successful outcome.<\/p>\n
<\/p>\n
WHY IS BOLLORE EXITING?<\/strong> There is wide-ranging speculation on this subject. This ranges from the imminent retirement of Vincent Bollore, long-time head of the Bollore Group through to his indictment in France for \u201ccorruption of foreign agents holding public authority\u201d relating to port concessions obtained in Lome and Conarky, the fall-out from the 2016 train crash in Cameroon (operated under a Bollore concession) which killed 79 people and the more practical aspect of keeping up with the heavy investment requirement in the port sector in a more competitive environment. There is also the Douala episode which saw Bollore evicted from the container terminal there, a factor which is said to have contributed to an estimated 10 per cent drop in the turnover of the Africa logistics division. Ironically, it was TIL that was declared the winner of a new concession process for the Douala terminal but it has not taken up residence due to ongoing legal action surrounding Bollore\u2019s removal. Another reason to exit, which has come up in the past, is a desire on the part of Bollore to build up its activities in the media sector where it has a powerful presence.<\/p>\n Ultimately it may just boil down to the time is right and the price is right, especially with shipping line suitors around who are enjoying unprecedented profits. Indeed, Bollore has previously demonstrated its willingness to sell core assets, selling, for example, the Delmas-Vieljeux to CMA-CGM.<\/p>\n One thing is for sure, a sale of this nature encompassing 16 container terminals, diverse other port and logistics activities and three railway concessions does not come along that often and it will be extremely interesting to see the final outcome and price tag.<\/p>\n","protected":false},"excerpt":{"rendered":" The recent announcement that the Bollore Group is putting its African Logistics assets up for sale was not entirely unexpected, there have been murmurs in the market. What followed in short order was, however, a little surprising, namely granting the MSC Group, best known for its top tier ranking among container liner operators but also possessing its own fast growing terminal operating arm \u2013 Terminal Investments Limited (TIL), a period of exclusivity to carry out due diligence and conduct additional negotiations on the basis of a US$6.4 billion indicative bid.<\/p>\n","protected":false},"author":8,"featured_media":2248,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[68],"tags":[],"sponsor":[],"class_list":["post-2247","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-post-script"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts\/2247","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/comments?post=2247"}],"version-history":[{"count":1,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts\/2247\/revisions"}],"predecessor-version":[{"id":2249,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts\/2247\/revisions\/2249"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/media\/2248"}],"wp:attachment":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/media?parent=2247"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/categories?post=2247"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/tags?post=2247"},{"taxonomy":"sponsor","embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/sponsor?post=2247"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
So, what drives Bollore to exit its African logistics operations at this juncture?<\/p>\n