For a total investment of $21.6 million, Port of Tauranga has agreed to: acquire a 50 percent shareholding in PrimePort, excluding its investment properties; lease PrimePort’s container terminal for up to 35 years; acquire the container terminal operating assets and set up a new Port of Tauranga wholly-owned subsidiary, Timaru Container Terminal Ltd, to operate the terminal. The transaction is subject to the successful outcome of the Timaru District Council’s public consultation process.
Port of Tauranga chief executive Mark Cairns – a recently announced finalist in the KPMG Outstanding International Business Leader category of this year’s New Zealand International Business Awards – says the northern port continues to invest in becoming New Zealand’s hub port. “We see opportunities to grow PrimePort Timaru as a marshalling point for South Island cargo.”
The alliance will allow South Island exporters, including meat companies, to benefit from the large number of international services that call at Tauranga, share the significant freight savings that will come with the arrival in New Zealand of the next generation of large ships and benefit from Port of Tauranga’s container terminal expertise and world-class productivity.
Port of Tauranga has the financial strength, location and transport connections to be New Zealand’s hub port, says Cairns. “Not only can Tauranga Container Terminal accommodate large ships, with our significant land holdings we have the potential to continue to expand at a lower cost that all other New Zealand ports.”
PrimePort chairman, Roger Grower says that the alliance positions PrimePort well for the future for the movement of both bulk and container cargoes. “We expect this alliance to hasten the consolidation of freight routes in New Zealand by facilitating a more extensive schedule of coastal shipping and rail. It will allow for the redevelopment of Timaru port and the transport infrastructure in the region and the development of flexible and cost-effective routes to and from international markets for South Island exporters and importers.”
The joint venture will create the opportunity to deliver huge benefits to the community and transform trading opportunities for the South Canterbury region, says PrimePort chairman Roger Gower, who is “delighted with the alliance”.
PrimePort is located in the heart of the one of the country’s primary production regions, while 75 percent of the South Island’s population is located within a 200km radius of its gates. It also has the capacity to grow. In 2008, PrimePort was handling 80,000 TEU (twenty foot equivalent units, a measurement of capacity in container transport) a year. However, this number has declined as shipping lines have rationalised port calls in New Zealand.
PrimePort will still manage and operate all aspects of the Port, including breakbulk such as logs, fertiliser, fuel and all marine services. The only exception is the container terminal, which will be leased and operated by Port of Tauranga.
According to PrimePort, the deal has the capacity to open exciting new doors to exporters, in South Canterbury and beyond and “create a paradigm shift in the way freight is moved in New Zealand.”