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Cosco Pacific shells out 831m euros to lease two Greek piers

Cosco Pacific shells out 831m euros to lease two Greek piers

Hong Kong: Chinese ports investor Cosco Pacific said late Wednesday it will pay EUR831.2 million for a concession to manage two Piraeus Port Authority SA piers for up to 35 years.

Cosco Pacific said in a statement it would lease pier 2 at the Greek port for its exclusive use. It said the pier handled 1.37 million twenty-foot equivalent units last year. It will also lease pier 3, which is under construction.

The company said that upon completion of pier 2's upgrade by 2014 and the construction of pier 3 by 2015, the capacity of the container terminal will reach 3.7 million TEUs.

Any profit exceeding a 16% internal rate of return will be split between the company and the local port authority, Cosco Pacific said.

Meanwhile, the firm said on Wednesday it will cut capital spending and defer uncommitted projects and expansion of existing terminals amid a global financial crisis, boosting its stock nearly 14 percent. The Chinese port operator and container leasing firm will cut capital expenditure in the fourth quarter and next year to control cash outflows and strengthen its balance sheet, Winnie Fan, senior investor relations manager, told Reuters. She would not give the new target for capital expenditure.  [30/10/08]