AD Ports Group acquires 80% stake in Global Feeder Shipping

AD Ports Group has signed an agreement to acquire an 80 per cent equity stake in Dubai-based Global Feeder Shipping (GFS), a global container shipping company.

The total purchase consideration for the stake amounts to Dhs2.9bn ($800m), implying a 100 per cent enterprise value of Dhs3.7bn ($1.0bn), with the acquisition being fully funded through a new acquisition loan.

GFS’ LTS financial performance was strong with revenue of $1.08bn, EBITDA of $521m (Earnings Before Interest, Taxes, Depreciation, and Amortisation margin of 48 per cent), and net profit of $481m.

The company has one of the largest fleets of container ships globally, featuring 26 owned and operated vessels with a total capacity of 72,500 TEUs, covering the Middle East, Indian Subcontinent and Southeast Asia with services connecting the UAE to India, Pakistan, Sri Lanka, Egypt, Sudan, Djibouti, Yemen, Kingdom of Saudi Arabia, Bahrain, China, South Korea, and Vietnam, among others.

AD Ports Group will look to integrate GFS into its maritime cluster, which already offers a comprehensive portfolio of shipping, offshore and subsea services. Aligning GFS services with AD Ports Group companies SAFEEN Feeders and Transmar will make AD Ports Group the world’s largest independent feeder company by vessels owned, with an owned fleet of 35 vessels, and the third largest globally by volumes carried with a total container capacity of 100,000 TEUs.

The acquisition will boost AD Ports Group’s trade activities and connectivity to core markets, as well as enhance its feedering business, providing significant economies of scale through an expanded route network and fleet.

GFS’ integration with SAFEEN Feeders’ services has the potential to generate significant operational synergies.

Subject to regulatory approvals, the transaction is expected to close in Q1 2023. GFS’s existing management will remain in place with the founders retaining a 20 per cent stake in the company.

Captain Mohamed Juma Al Shamisi, Managing Director and Group CEO, AD Ports Group, said: “GFS offers more than 30 years of experience and excellence in the provision of container feeder services in the Middle East, Asia and Africa, in addition to a diverse and fit-for-purpose fleet. Our Maritime Cluster has delivered remarkable returns in 2022, reflecting the significant market appetite for shipping, offshore and subsea services, and integrating GFS into our operations will enable us to increase our customer base, broaden our global footprint and build upon this significant momentum. As always, we thank the UAE’s wise leadership, whose support has enabled us to achieve today’s historic announcement.”

Amir Maghami, chairman, GFS, said: “This is a key moment for GFS, which sees our company become part of AD Ports Group to create the largest single provider of shipping services in the region. I am truly proud of what our team has achieved and excited for the future, which will see us continue expanding our global footprint. Our priority has always been to continuously improve our systems and processes to serve global trade, and under the ownership of AD Ports Group we will be able to deliver a new level of service and support for international customers.”

In other news, Geo-data specialist Fugro and AD Ports Group have inked an agreement to create a platform to implement remote and autonomous technology, and guidelines for the use of the latest industry advancements to benefit the maritime industry.

Read: Fugro, AD Ports Group to create platform to implement remote and autonomous technology