ICTSI's chairman publicly attacked Maersk, accusing it of using unfair tactics
Enrique Razon, the billionaire head of International Container Terminal Services (ICTSI), has intervened in an ongoing legal battle in South Africa, accusing Maersk of underhand tactics in an attempt to preserve its "dominant position" in the country.
APM Terminals' lawyers last month successfully shelved rival ICTSI's plans to enter South Africa's largest container port, dealing another embarrassing setback to the African country's efforts to privatise and improve port facilities.
A South African court has decided to temporarily block ICTSI's 25-year deal with state-run Transnet to take over a container terminal in Durban.
Previously, both ICTSI and Maersk APM Terminals participated in the tender for the Transnet project, and there was a fierce competition. In the end, ICTSI successfully won the tender for the right to buy nearly half of the main container terminal in Durban, South Africa, and will operate the terminal for 25 years. But Maersk has complained bitterly about ICTSI's winning bid, noting in court documents that ICTSI failed to meet Transnet's solvency criteria when it bid. Maersk further claimed that according to ICTSI's financial statements for 2021, its ratio of total equity to total assets is much lower than the 0.4 required by the tender.
In rare public remarks, Enrique Razon, listed by Forbes as the Philippines' second-richest man, lashed out at Maersk, claiming ICTSI outbid APM Terminals for the Durban contract by $100 million.
Maersk, he claimed, has a dominant position in South Africa and a "strong pricing advantage" in the market. "Maersk is clearly anxious to prevent independent common user end operators from entering the South African market. In short, after failing to come up with a strong offer, they are instead trying to delay and block the process through the courts, "Razon said, going on to slam state-run Transnet. "Instead of acting quickly, Transnet dragged its feet at the highest levels, suggesting that someone within the organization did not want this process to continue."
After 20 years of efforts, the South African government has taken the first step towards port privatisation through Transnet, granting ICTSI the right to privatise ports.
Ten months ago, Transnet selected ICTSI as the preferred bidder for the joint venture to develop and upgrade the flagship Durban terminal to increase its annual capacity from the current 2 million TEU to 2.8 million TEU.
Enrique Razon said the legal delays ICTSI has since encountered will make it more difficult for any private partnership to succeed. "Of course, this is good for Maersk, as they have as much interest in the failure of the process as their inferior bid being accepted," he said, adding: "Either outcome would be a huge setback for the government's economic agenda, but a success for Maersk's desire to control South Africa's logistics system end-to-end."
Maersk has not yet responded.
APM Terminals' lawyers last month successfully shelved rival ICTSI's plans to enter South Africa's largest container port, dealing another embarrassing setback to the African country's efforts to privatise and improve port facilities.
A South African court has decided to temporarily block ICTSI's 25-year deal with state-run Transnet to take over a container terminal in Durban.
Previously, both ICTSI and Maersk APM Terminals participated in the tender for the Transnet project, and there was a fierce competition. In the end, ICTSI successfully won the tender for the right to buy nearly half of the main container terminal in Durban, South Africa, and will operate the terminal for 25 years. But Maersk has complained bitterly about ICTSI's winning bid, noting in court documents that ICTSI failed to meet Transnet's solvency criteria when it bid. Maersk further claimed that according to ICTSI's financial statements for 2021, its ratio of total equity to total assets is much lower than the 0.4 required by the tender.
In rare public remarks, Enrique Razon, listed by Forbes as the Philippines' second-richest man, lashed out at Maersk, claiming ICTSI outbid APM Terminals for the Durban contract by $100 million.
Maersk, he claimed, has a dominant position in South Africa and a "strong pricing advantage" in the market. "Maersk is clearly anxious to prevent independent common user end operators from entering the South African market. In short, after failing to come up with a strong offer, they are instead trying to delay and block the process through the courts, "Razon said, going on to slam state-run Transnet. "Instead of acting quickly, Transnet dragged its feet at the highest levels, suggesting that someone within the organization did not want this process to continue."
After 20 years of efforts, the South African government has taken the first step towards port privatisation through Transnet, granting ICTSI the right to privatise ports.
Ten months ago, Transnet selected ICTSI as the preferred bidder for the joint venture to develop and upgrade the flagship Durban terminal to increase its annual capacity from the current 2 million TEU to 2.8 million TEU.
Enrique Razon said the legal delays ICTSI has since encountered will make it more difficult for any private partnership to succeed. "Of course, this is good for Maersk, as they have as much interest in the failure of the process as their inferior bid being accepted," he said, adding: "Either outcome would be a huge setback for the government's economic agenda, but a success for Maersk's desire to control South Africa's logistics system end-to-end."
Maersk has not yet responded.
