Court decision delays Durban container port revamp

Filipino port operator International Container Terminal Services Inc (ICTSI) will have to wait till March to see if it can take over management of the Durban container port.

- Ciaran Ryan

The Durban High Court this week dismissed its appeal against an order granted by the same court in October preventing Transnet from implementing the partial privatisation of the Durban Container Terminal Pier 2 that would see ICTSI acquire 49% of the terminal, with Transnet retaining the majority share.

The contract to run the port is for 25 years and would see ICTSI invest about R11 billion in new equipment and upgrades.

Basis of the case That case was brought by losing bidder APM Terminals, part of Danish shipping company AP Moller-Maersk, which claimed the tender was full of irregularities, not least of which was a solvency test that allowed ICTSI to use market cap rather than balance sheet equity.

On this basis, ICTSI cleared the solvency hurdle with ease. All other bidders were measured on balance sheet equity, a much stiffer measure of solvency.