Under the agreement, CDPQ will invest $2.5 billion in the Jebel Ali Port, the Jebel Ali Free Zone and the National Industries Park through a new joint venture in which it will hold a stake of approximately 22 per cent, with the remainder of the transaction being financed by debt.
Other long-term investors will have the opportunity to acquire an additional stake of up to $3 billion according to CDPQ’s latest release.
The transaction implies a total enterprise value of approximately $23 billion for the three assets.
The first tranche of the transaction – $5 billion – is expected to close in the second or third quarter of 2022, while the second tranche – up to $3 billion – is estimated to close during the fourth quarter.
The companies have disclosed that business will remain fully consolidated within the DP World group, and day-to-day operations, customers, service providers, and employees will not be affected.
“Overall, we believe this transaction provides a strong platform for the UAE assets to meet their long-term growth objectives, while the stronger balance sheet supports the group’s wider end-to-end supply chain solution strategy, which will drive sustainable value for all DP World stakeholders,” commented DP World Chief Executive and Chairman Sultan Ahmed Bin Sulayem.
“The transaction also achieves our objective of reducing DP World’s net leverage to below four-times net debt to EBITDA. This has been achieved despite the challenges of the pandemic and recent global economic conditions.”