Balancing the portfolios

Swings in port ownership throughout southern Europe are changing the face of Mediterranean operations. Alex Hughes reports
Major ownership changes sweeping through ports and terminals across southern Europe will change the focus of transportation in the region.
In Italy, ownership gains and losses for the country’s most important container terminal operator, Contship Italia, have split operational successes.
With interests in five domestic ports, two intermodal companies and an international transhipment terminal in Morocco, Contship Italia has a wide portfolio.
In terms of business in 2011, the import-export terminals did best. La Spezia Container Terminal had a throughput of 1.07m teu (+2.7%), setting a new record high, while Terminal Container Ravenna's 198,000 teu (+14%) brought it back to the pre-2009 crisis level. At Salerno Container Terminal, traffic stagnated at 171,000 teu (-0.3%).
However, the two transhipment terminals struggled. Throughput at Medcenter Container Terminal at Gioia Tauro fell 19.2% to 2.305m teu, while Cagliari International Container Terminal was down 3.2% to 558,000 teu.
The company's intermodal business, undertaken by Sogemar and Hannibal, transported 250,000 teu, a rise of 8.9%.
Contship Italia is mainly focused on marine container terminal and Intermodal transport, stresses company chief executive Cecilia Eckelmann-Battistello.
“Our strategy is to continue to invest in our core business in the Mediterranean and Black Sea areas, as well as worldwide and thereby to achieve constant growth for our container terminal and intermodal businesses,” she says.
In the past, Contship has tried unsuccessfully to obtain concessions to operate at Voltri, but lost out to PSA. When asked whether the port remains of interest, Mrs Eckelmann-Battistello replies: “If the right opportunities arise, we will almost certainly consider them.”
Contship Italia also withdrew from the TDT container terminal in Livorno under what were viewed as acrimonious circumstances, although Mrs Eckelmann-Battistello disputes this. “It is not correct to say that the circumstances were acrimonious. The disagreement between the two controlling parties at TDT was fully regulated by a shareholders' agreement. Contship Italia preferred to exit TDT and cash in its shares,” she says.
In respect of problems at Gioia Tauro, she notes that in July 2011, one of Medcenter's main clients – Maersk - changed its strategy in the Mediterranean in order to achieve cost savings. In effect, Maersk left just a single feeder vessel call as Medcenter, withdrawing its entire transhipment business. This concentrated minds and has ultimately resulted in ownership changes.
In January 2012, TIL, which the industry regards as the effective terminal arm of shipping line CMA CGM, bought into the business, although whether the French shipping line will use Gioia Tauro as its main transhipment hub has yet to be established.
Mrs Eckelmann-Battistello comments: “The entry of TIL - and the continuing partnership with APM Terminals - contributes to further reinforce the terminal commercially and organisationally to allow it to face the challenges of a difficult operating environment in the global container shipping market.”
As for the future of Contship Italia's other transhipment hub at Cagliari, this remains the central Mediterranean hub of the Grand Alliance, whose position was further strengthened following a 90% reduction of anchorage fees as of this year.
Intriguingly, Contship Italia is very much hedging its bets in terms of transhipment. It owns a 20% stake in Eurogate Tanger Terminal, where it forms part of an ownership consortium including Eurogate, CMA CGM and TIL. The presence of the Italians is not a token one, either, since both board presidents to date - Domenico BagalĂ  and Marco Mignogna – have come from Contship Italia.
Ownership of ports in Spain also took an interesting turn in 2010, when the Dragados-SPL ports holding was sold to JP Morgan, being subsequently rebranded Noatum Ports. It remains Spain’s leading player in this sector, with a trading volume in 2011 of close to 4m teu, 50m tonnes of bulk and other freight goods, and over 400,000 vehicles. Its shipping agencies also attend about 8,000 ships every year.
Although several former high profile Dragados-SPL managers have left the company, replacements have international experience from the sector, as is the case with the new commercial director, Kim Gadegaard.
Commenting on recent changes, he says, “We have consolidated and strengthened the organisation and are now focussed on the ports and port logistics sector as our area of expertise.”
The new owners already have extensive business experience and want to see Noatum become an international transport and logistics platform, he adds. In addition, they have expressed several times their continued international focus, valuing possible new investments in OECD countries, which could generate added value and synergies in the group.
Asked where he expects the main growth to come from in future, Mr Gadegaard says it is not possible to say at this stage. While current terminals and ports have some capacity to grow organically, further growth beyond that will have come from new projects.
“We are continuing to invest in technology and new equipment. Noatum Container Terminal Valencia, for example, has recently bought a new port crane and implemented a gate automation project. We are also analysing potential investments in several countries that will generate added value and more synergies to the group companies,” he says.
The holding also remains open to expansion possibilities. Even though Dragados-SPL sold off its overseas assets prior to its sell off, Noatum, says Mr Gadegaard, does have international aspirations.
“We are in an international business, so we are constantly analysing different markets,” he says.
In respect of the Spanish core market, where Noatum is also open to investment possibilities, Noatum is being very cautious towards forecasts for 2012.
“Obviously, the development of the Spanish economy will have a great impact, but we are equally concerned about our terminals being able to continue to compete with ports and terminals in surrounding countries. If our competitiveness is not improved it could negatively affect the volumes moving through Spanish ports,” says Mr Gadegaard, echoing similar calls from shipping lines and other terminal operators.
Finally, despite the presence of HPH, DP World and APM Terminals in Spain, Mr Gadegaard believes that Noatum does have the ability to compete with all companies whether national or international in the ports where it has a presence.


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