Business | Shipping
P&O votes for DP World offer
Shareholders of British port operator Peninsular and Oriental Steam Navigation Company (P&O) on Monday voted overwhelmingly in favour of DP World's offer to acquire the firm for £3.9 billion ($6.8 billion).
- By Shakir Husain, Staff Reporter
- Published: 00:00 February 14, 2006
Dubai: Shareholders of British port operator Peninsular and Oriental Steam Navigation Company (P&O) on Monday voted overwhelmingly in favour of DP World's offer to acquire the firm for £3.9 billion ($6.8 billion).
"It is a vote of confidence in our ability to manage the company," DP World chairman Sultan Ahmad Bin Sulayem told Gulf News.
At the extraordinary general meeting of P&O in London, shareholders voted 99.52 per cent to back the offer that valued P&O stock at 520 pence per share, according to a company statement received by Gulf News.
"We are delighted that stockholders have voted to support our acquisition of P&O which brings to an end a period of uncertainty.
P&O is an excellent company with a great heritage and we welcome them warmly to the DP World family. Together we are one of the world's top three ports operators. There can be no doubt about the compelling strategic fit the companies have together. This is very good news for our customers and our combined staff."
Dubai had to secure the support of more than 75 per cent of those attending the meeting.
With the acquisition of British ports and ferries group makes, DP World has sailed into third place from number seven among the world's top port operators.
The merged shipping behemoth will ensure DP World's presence in port operations around the globe and give a huge boost to the company's container handling capacity and earnings.
"We now have 50 ports in 30 countries," Bin Sulayem said.
He said DP World will remain busy over the coming months in integrating P&O's business to its own.
Bin Sulayem said there were no plans to sell off P&O's non-core European ferries business, which has been under pressure from low-cost airlines and the Eurostar train.
"The company's is in good health. We are committed to the old business plan of P&O," he said.
Winning P&O will halt DP World's current hunt for overseas port assets in an era of rising international trade, which mostly relies on sea transport.
"For the coming few months we'll be busy integrating P&O assets. But we are always looking for assets," Bin Sulayem said.
On DP World's competition with PSA, he said both the companies were interested in developing their business.
DP World chief executive officer Mohammad Sharaf added that competition was always healthy for the industry.
"We respect PSA and are aware of the competition. We will continue to have competition. I think it is healthy for the industry," he said.
The 520 per share knockout Dubai offer came on January 26 after PSA made an offer of 470 per share, topping Dubai's original offer of 443 pence on November 29.
Sharaf said in 2005 DP World container throughput was 13.6 million TEUs (twenty-foot equivalent units) of which the share of its Dubai ports was 7.7 million TEUs. "We are expecting a double-digit growth," he added.
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