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Liverpool port operator attracts bids from overseas funds - sources

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By Reuters
Liverpool port operator attracts bids from overseas funds - sources
FILE PHOTO: A dock worker walks between empty shipping containers at Peel Ports Liverpool container terminal in Liverpool, Britain December 9, 2016. REUTERS/Phil Noble   -   Copyright  Phil Noble(Reuters)

By Clara Denina and Arno Schuetze

LONDON (Reuters) – Peel Ports, Britain’s second largest port operator, has attracted bids for a stake of up to 25% from international funds, undeterred by worries about the country’s scheduled departure from the European Union, two sources said.

Owners DWS, Deutsche Bank’s <DBKGn.DE> asset management arm, and Peel Group, the infrastructure investment company founded by British businessman John Whittaker, are selling a combined 20%-25% stake of the port operator valued at around 4 billion pounds with the help of investment bank Rothschild, according to the sources.

Dutch pension fund APG, Australian funds Queensland Investment Corporation (QIC) and AustralianSuper, and British-based Equitix Investment Management are considering separate proposals for the stake, the sources said, adding that the funds see the potential for profit despite disruptions to imports and exports that could potentially result from Brexit.

APG declined to comment. QIC, AustralianSuper and Equitix did not immediately respond to a request for comment.

The sale is expected by the end of the year, one of the sources said.

Peel Group and DWS declined to comment.

Prime Minister Boris Johnson has vowed to take Britain out of the EU by Oct. 31, without a transition deal if necessary.

A no-deal Brexit could mean severe disruption to trade, supplies of medicines, fresh foods and possible public disorder, according to the British government’s contingency plans.

Peel Ports, which owns and operates the Port of Liverpool and the Manchester Ship Canal, handles cargo of 70 million tonnes a year, some 15% of total port traffic.

Ports have been on the radar of pension and infrastructure funds as they deliver steady, predictable cashflow and are a good match for their long-term liabilities.

Ports are valued also because they are surrounded by other infrastructure, including railways and storage facilities.

A consortium led by Poland’s sovereign wealth fund, PFR, global port group PSA International and fund manager IFM Investors bought the DCT Gdansk port terminal in Poland, while Greece sold its biggest port Piraeus Port Authority to shipping group China COSCO Shipping Corporation as part of its privatisation.

(Reporting by Clara Denina and Arno Schuetze; additional reporting by Jonathan Saul and Toby Sterling, editing by Louise Heavens)