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China Cosco Shipping finally gets Piraeus port majority stake

China Cosco Shipping finally gets Piraeus port majority stake
China Cosco Shipping finally got its hands on Greece’s largest port, Piraeus, 8 April when it signed a share purchase agreement with the Hellenic Republic Asset Development Fund (HRADF) to acquire a 67% stake in the Piraeus Port Authority (PPA).

The EUR368.5m ($413m) investment is the first cross-border M&A transaction signed by China Cosco Shipping following its establishment, and is seen as a landmark initiative for the group to expand its global network.

The signing ceremony was attended by Greek Prime minister Alexis Tsipras, chairman of China Cosco, Xu Lirong, HRADF chairman, Stergios Pitsiorlas and Zou Xiaoli, Chinese Ambassador to Greece.

Under the deal, China Cosco will acquire 51% of the PPA for Euro 280.5m and the remaining 16% for Euro 88m, after five years once it concludes mandatory investments, which will amount to Euro 350m.

Xu said his company has been “implementing high-quality investments in the port since 2009”.

He said: “Over the last few years, China Cosco Shipping has successfully enhanced the competitiveness and significance of Piraeus in the international shipping market, and contributed actively to the local economic development. Piraeus has now become a modern large-scale container terminal with leading technology, the fastest growing port in the past two years in terms of port handling capacity among the Top 100 container ports internationally, and an important hub for many international container liner companies in the East Mediterranean area.

“Upon completion of the acquisition, China Cosco Shipping will capitalise on the strategic opportunity provided by the ‘One Belt, One Road’ initiative, vigorously embark on a new series of infrastructure and operational investments that will fully streamline the port’s performance and will help PPA reach its full potential to become one of the leading ports in Europe.”

He vowed the company would not only operate “a state-of-the-art port that will connect Asia and Europe trade, but will also create jobs and help invigorate the Greek economy”.

Zou said, the agreement marks a historic milestone for Sino-Hellenic friendship and relationships at multiple levels. “With China Cosco Shipping’s fleet and technical expertise, Greece will become the leading gateway for Chinese products to Europe, and Greek exports to China will be further enhanced.”

The ambassador said Greek and Chinese fleets and shipping know-how are known around the world for their efficiency and strength, thus joining forces seems only natural.” 

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