CANBERRA: Australia’s Qube Holdings has upped the ante in its quest for full control of Patrick, Oceania’s largest stevedore and terminal operator, after saying it was willing to pay $1.9 billion.
The newest offer, which was disclosed via filing with the Australia Stock Exchange Thursday, is the latest salvo between Qube and Canada’s Brookfield Infrastructure group for control of Patrick’s parent company, Asciano Holdings.
Qube contends that control of Patrick would allow it to invest heavily in intermodal infrastructure and create new efficiencies through control of Port Botany. The port, located near the Sydney suburb of Moorebank where Qube is building a $1.1 billion intermodal hub, could soon usurp Melbourne as the country’s top container gateway. The terminal will have a capacity of 1.5 million twenty-foot-equivalent units when it opens in 2017.
Qube believes that through control of Patrick it can generate synergies valued at between $21 and $35 million. The company has also promised to embark on projects similar to the Moorebank intermodal hub at the other key Australian container ports of Brisbane, Fremantle, and Melbourne.
Qube said it has the industry experience to properly manage Patrick. Qube is led by Chris Corrigan, who led Patrick until he was forced out as part of Asciano’s hostile takeover in 2008.
“Competition in Australian stevedoring is quite good,” Rod Nairn, CEO of Shipping Australia, a group that represents international shipping interests, told IHS Fairplay, a sister product of JOC.com within IHS. “We do have some concerns about vertical integration. While it could be beneficial and efficient, it could also have a negative impact on competition.”
The Moorebank terminal will be automated, and Corrigan, who led Patrick’s automation charge in the 1990s, has promised to introduce further automation at Patrick terminals. Automation was also one of the reasons Qube argued that it was better positioned to manage Patrick than Brookfield.
Corrigan has worked hard to regain control of Patrick, going so far as to have Qube buy a vote-blocking share of Asciano to thwart Brookfield from taking complete control of it.
