ICTSI okays secondary offer to raise funds for new acquisitions

Port operator International Container Terminal Services Inc. (ICTSI) has approved the secondary offering of up to 300 million shares currently held by its unit ICTSI Warehousing Inc. to raise funds for new acquisitions.

In a disclosure to the Philippine Stock Exchange, ICTSI said it has tapped UBS Investment Bank as sole global coordinator and bookrunner for the issue with CLSA as co-lead manager.

ICTSI said the offer price will be determined by a bookbuilding process following an international roadshow. It did not give a timetable for the share issuance.

Proceeds from the sale will be remitted back to ICTSI and will be used to fund its acquisition of new terminals and for general corporate purposes.

The company said it bought back a total of 38.6 million of its own shares held by ICTSI Warehousing and its other unit, IW Cargo Handlers Inc., on Thursday at P28 per share through the stock market.

ICTSI chairman and CEO Enrique Razon Jr. said the company continues to look at ports in Eastern Europe, Latin America, Middle East, and Asia to further expand its international reach.

ICTSI targets ports with a handling capacity of 300,000 twenty foot-equivalent units (TEUs) to one million TEUs.

ICTSI operates container terminals in Poland, Brazil, Madagascar, Indonesia and Japan. Last year it won a 10-year concession to operate the Tartous Container Terminal in Syria.

In January it signed an agreement to buy 60 percent of Yantai Gangtong Container Terminal Co. Ltd., which manages the Yantai Gangtong port in the eastern Chinese province of Shandong.

International operations continue to be a significant contributor to ICTSI’s earnings, accounting for 60 percent of the company’s total net profit last year compared with only 34 percent in 2005.

ICTSI’s net profit amounted to P1.84 billion in 2006, up 37 percent from P1.35 billion a year earlier.

Gross revenues from port operations went up 14 percent to P11.85 billion from only P10.44 billion.

After selling seven of its overseas port operations in 2001, ICTSI has been acquiring new terminals abroad over the past three years to further boost revenues. Its flagship operation is the Manila International Container terminal — the main entrance and exit point for the country’s imports and exports.

Last year, ICTSI invested P1.8 billion to continue to expand the handling capacity and improve the operating efficiency of its operations in Manila, Poland, Brazil and Madagascar.