China Consortium by Port Investor


Published on

Published in: Business, Economy & Finance
  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

China Consortium by Port Investor

  1. 1. CHINACONSORTIUM By Port Investor
  2. 2. Opportunities in the Chinese Port Sector Massive container, dry bulk, oil and CHINA IN THE WORLD TODAY liquids markets - representing an (a few key numbers on the Chinese economy and its Port Sector) immense share of world throughput 1.3 >400 New segments such as bio fuel and Billion people >25% Mill. tons others in rapid development Of world container of crude oil demand + throughput target to further increase oil supply Limited competition - many ports with reserves one controlling port group 10% Consistent growth Strong interest with local governments last 30 years – may overtake the US by 11 to attract “multinationals” 2030 Of the worlds 20 biggest ports Negotiated deals are the norm (vs open and 50+ large tender) 10 >60% “secondary” ports  Less competition for developments Trillion USD Of world iron PPP adjusted GDP ore demand  More deal flexibilityBut tapping into this potential requires a significantly different approach than most take - it requires a newmodel that engages local stakeholders in a positive way. For investors just bringing money the window ofopportunity may well have passed in China.
  3. 3. Typical challenges in securing investments The deal pyramid illustrates a few key rules of the marketplace: Deal a) The quality of the output is determined by the 1-5 input – poor market scanning and market Lead intelligence leads to poor leads development b) The most valuable deal leads are created pro- 10 - 50 actively through focused market engagement Focused c) Each deal lead requires a strong contact and market engagement engagement base to develop into an actual 100 - 500 investment Market scanning and d) Only a few of the potential market targets will intelligence end up as deals - without a substantial 1,000 – 5,000 pipeline no investments or dealsMany believe they can avoid building the pyramid – it’s anillusion, the deals you get access to are only as good as yourpipeline.
  4. 4. Challenges in the Chinese Port Sector Many Chinese constituents like building on partnerships – one deal can lead to a larger number of leads and deals Deal With the blessing of local partners and government, deals can be cut quickly Once into a stage of exploration of Lead cooperation there is often presumed exclusivity for a period development Actual leads eventuate from close dialogue and relation development – Any real engagement requires local often very unstructured Focusedrelations and a real proposition to both government and port market engagement Multitude of local stakeholders including local government and port Local presence required for any entities – wide engagement often req. real insight – several sources Market scanning and often required for verification intelligence No or little market intelligence available through desk research
  5. 5. The purpose of China Consortium WHAT A group of operators, investors, and developers many of which have world leading technology, experience and Shipping lines Asia funding capability Port industries Latin America Not a consortium in the traditional sense Energy and resources Middle East – there is no forced collaboration just collaboration opportunities in the many CARGO OWNERS PORT PARTNERS markets and sectors WHY Combined leverage makes it possible to CONSORTIUM create much more clout in the local markets Complementary skill-sets from major port DEVELOPERS INVESTORS OPERATORS infrastructure fields that will allow synergies as each seek to develop in the Free Zone Pension Fund Container market Marine Infra. Private Equity Oil & Liquid We have been active in the Chinese port Dry Bulk Construction Sovereign Fund market for nearly a decade – the market and its constituents are well suited to engage with this form of “consortium”
  6. 6. Status and how to participate We have cooperation with global as well as local Chinese operators, funds, developers, port groups and many others. As development and collaboration opportunities emerge we involve clients that we have formalized cooperation with and (if relevant) parties that may benefit our existing client network for specific developments or acquisitions. China Consortium is already in motion in several locations. If you would like to be part of it please contact us at and we would be glad to discuss your needs and relevant scope for the Chinese infrastructure market. For more information about developing markets with Port Investor see appendix or go to:
  7. 7. APPENDIXThe Chinese Port Markets
  8. 8. Appendix – Total market and bulk segmentIn total throughput the Chinese port sector was nearing a total China port bulk cargo category by weight Million tons 2010throughput of 9 billion tonnes in 2010 and a 17% growth over Coal 1,6462009. In total throughput the bulk markets fuelled by amongst Metal Ore 1,263others the continuing need for infrastructure development and Construction material 1,204energy the Chinese bulk sector represented the majority. Of the Oil & Gas 712total market river ports represented 37%. Steel & Iron 391 Cement 187 None-metal Ore 185China >100 mn tons Ports in 2009 Mechanical/Instrument 170million tons Coal Metal Ore Construction material Grain Sum Grain 169 Ningbo-Zhoushan 62.3 140.9 33.5 6.5 243.2 Chemical 159 Qinhuangdao 206.8 19 1 2.5 229.3 Light industry and pharmaceutical 94 Tianjin 65 93.5 42.1 4.7 205.3 Wood 51 Shanghai 79.2 66.7 12.9 1 159.8 Tangshan 63.5 90.7 0.5 0.07 154.8 Rizhao 23.1 106.9 7.4 5.2 142.6 Guangzhou 75.5 6.4 32.3 9.3 123.5 China ports cargo type split by weight Qingdao 16.4 100.7 0.02 3.8 120.9 (mn tons in 2010) Sea Ports 439 Yingkou 22.7 32.6 7 5.5 67.8 5% Beibu Gulf 27.4 28.2 1.4 6.4 63.4 Lianyungang 12.8 41.8 2.8 5.5 62.9 Dalian 10.3 28.1 2.6 15.9 56.9 1,532 Xiamen 14.6 5.8 26.9 2.9 50.2 Dry bulk 17% Zhanjiang 4.7 35.1 4.8 1.3 45.9 Liquid bulk Yantai 13.2 26.1 0.7 2.2 42.2 Shenzhen 4.5 14.4 3.8 16.3 39 Break bulk Suzhou 61.1 52.4 22.8 4.6 140.9 954 11% Container Nantong 16.8 42.1 31.5 6.6 97 5,153 Jiangyin 24.2 21.9 20.1 1.2 67.4 58% Roll/RollRiver Ports 854 Zhenjiang 16.6 30.7 16.4 0.8 64.5 Huzhou 16.2 0.3 45.2 1.4 63.1 9% Nanjing 18.5 25.4 4 2.1 50
  9. 9. Appendix – Container ports China Container Throughput splitWith a total throughput of about 144mn TEU China represented 2010 (mn TEU)28% of the world container port market in 2010. Whereas China inpure throughput numbers is dominated by big ports, of which 6exceeded 10mn TEU in 2010, China has a large number of 7.26 20.34“secondary ports” with substantial development potential, we 5% 14%estimate at least 50 ports and many more single locations. Top 10 Yangtze The rest 118.4 China Top 10 Container Ports 81% Throughput 2008-2010 35,000 30,000 25,000 China Container Throughput split 2009 (mn TEU) 20,000 K TEU 15,000 2010 10,000 5.7 2009 17.6 5,000 5% 14% 2008 0 Top 10 Yangtze The rest 98.7 81%
  10. 10. Appendix – Oil and liquid ports (1)2005-2015 China refinery capacity 2005 2009 2010 2015 ETotal Capacity (1,000 tonnes) 324,490 478,000 504,800 696,800Sinopec 163,500 50.4% 216,000 45.2% 237,800 47.1% 314,300 45.1%Petro China 119,390 36.8% 149,000 31.2% 154,000 30.5% 214,000 30.7%Cnooc 500 0.2% 32,100 6.7% 33,500 6.6% 56,000 8.0%Sinochem and others 41,100 12.7% 80,900 16.9% 79,500 15.7% 112,500 16.1% China crudeoil China Oil Exp & Imp consumption and production 300,000 250,000 500,000 60 200,000 ,000 TONS 400,000 50 150,000 40 300,000 100,000 30 200,000 50,000 20 - 100,000 10 2005 2006 2007 2008 2009 2010 - 0 2005 2006 2007 2008 2009 2010 Import Export Consumption Produced in China Dependence for Import %
  11. 11. Appendix – Oil and liquid ports (2)Port Throughput Capacity for SPR SPR Locations Phase OperatorNingbo 宁波 80,542 (mill CBM)Qingdao 青岛 65,080 Tianjin II 5 SinopecTianjin 天津 61,510 Shanshan (Xinjiang) II 8 Petro ChinaDalian 大连 61,121 Zhoushan (Zhejiang) I & II 7.5 SinochemTaizhou 泰州 54,780 Dushanzi (Xinjiang) II 5.4 Petro ChinaZhoushan 舟山 45,034 Zhenhai (Zhejiang) I 5.2 SinopecHuizhou 惠州 39,642 Huizhou (Guangdong) II 5 CnoocNanjing 南京 33,400 Huangdao (Qingdao, Shandong) I 3.2 SinopecShanghai 上海 25,295 Dalian (Liaoning) I 3 Petro ChinaZhanjiang 湛江 23,890 Lanzhou (Gansu) II 3 Petro ChinaYingkou 营口 21,192 Jinzhou (Liaoning) II 3 Petro ChinaQuanzhou 泉州 (福建) 17,130 Jintan (Jiangsu) II 3 Petro ChinaYangpu 杨浦 15,600Shenzhen 深圳 14,469Laizhou (Shandaong) 莱州 14,000 Currently 12 SPR bases are planned, among which the 4 in phaseMaoming 茂名(广东) 13,610 1 are already operational (since 2008), with capacity of 16.4 mill.Beibu Gulf 北部湾 12,220 cbm (or about 14 mill. tonnes). Another 8 are planned as phaseZhuhai 珠海 12,100 2, which is now under construction adding 39.9 mill cbm.Jinzhou 锦州 10,800 Locations for phase 3 are under investigation and planned to addNantong 南通 9,500 another 43 mill. cbm of storage capacity.Qinhuangdao 秦皇岛 8,720Guangzhou 广州 5,700Notes: All figures represent 2010 throughput in1,000 tonnes
  12. 12. APPENDIXMarket Development with Port Investor
  13. 13. Why? Thousands of ports, assets and projects… …hundreds of different investment models… …an infinite amount of opportunities! The challenge – how to tap the potential? Too little time – too few resources… Too big – too small… Too expensive – too risky… Too early – too late…The solution – risk free market engagement and effective deal creation! 50,000 Deal Tens of 5,000 thousands 1-5 Thousands of targets of markets + Develop 500 Hundreds of 10-20 investment models Engage 50-100 Market intelligence and scanning Matching propositions 1,000-5,000
  14. 14. What? Bulk Financial investor Singapore Dampier Corpus Christi London Southampton Shanghai Hamburg Gladstone Bergen Wilhelmshaven Container Rotterdam New York Primorsk Taichung Calais$10+ million Operator Tianjin Nantong Bremen Bombay Baltimore Ningbo Vancouver Long Beach Barcelona Forth Ports Guangzhou Yantai Corpus Christ Sao Sebastiao Bilbao Greenfield Brownfield Qingdao Hong Kong Nanjing Kitakyushu Algeciras Pohang Lake Charles Trieste Pittsburgh Yanbu Qinhuangdao Tangshan New Orleans Texas City Karachi Dalian Itaqui Grimsby Baton Rouge New Mangalore Developer Majority Busan lianyungang Beaumont Saldanha Bay Tampa Nagoya Tubarao Huntington Paradip Milford Haven Shenzhen Marseilles Constantza Jeddah Odessa Acquisition Oil & Liquid South Louisiana Houston Newcastle Kobe Mobile Hampton Roads Tees Manila Leghorn Paranagua Antwerp Amsterdam Ports St. Petersburg Alexandria Paulsboro Ulsan Osaka Valencia Taranto Tarragona Logistic Zone $100+ million Chiba Port Hedland Tanjung Pelepas Sepetiba Plaquemines Dunkirk Gothenburg Tampa Valdez Texas City Port Kelang Richards Bay Madras Jubail Liverpool Rizhao Hay Point Jawaharlal Nehru Tanjung Priok Savannah Yingkou Novorossisk Los Angeles Zeebrugge Brisbane Seed investor Free Zone Kaohsiung Tokyo Genoa Mormugao Lubeck Inchon Santos Calcutta Durban Pascagoula Yokohama Le Havre Izmit Duluth-Superior Angra dos Reis Minority $1+ billionWhether it is acquisitions, green fields, majority, minority, mature assets, high upside propositions, oil, container or bulk… Whether in China, Middle East, Europe, Latin America or any other nation or region… The opportunities exist or can be created!
  15. 15. Who?Pension funds, terminal operators, free zone developers, insurance funds, oil storage operators, shipping lines, sovereign wealth funds, bulk operators, logistics zone operators, private equity funds, construction companies, industrials, general investment funds, port groups… …that wish to invest …that wish to operate …that wish to develop …that wish to partner …that wish to collaborate The great thing about this?There are many more potential partners to cooperate and find solutions with than there are competitors!
  16. 16. How? Step 4 Deal Closing the deal 1-5 Step 3 Develop Deal development 10-20 Step 2 Engage Engage the most relevant 50-100 Step 1 Market intelligence Focus among the many and scanning 1,000-5,000Step 0 Purpose Target PropositionCreate the foundation
  17. 17. Now! Contact us on…and let us help you start developing the propositions you want! For more information on our market development process and the opportunities in the market place please refer to the appendices.
  18. 18. APPENDIX Choosing your scope
  19. 19. How can we help you… All constituents have different needs as concerns the target locations and the type of investments. These are just a small handful of examples.…relevant scope (1) Bulk Financial investor Singapore Dampier Corpus Christi London Southampton Shanghai Hamburg Gladstone Bergen Wilhelmshaven Container Rotterdam New York Primorsk Taichung Calais$10+ million Operator Tianjin Ningbo Nantong Vancouver Bremen Long Beach Bombay Barcelona Baltimore Forth Ports Guangzhou Yantai Corpus Christ Sao Sebastiao Bilbao Qingdao Nanjing Algeciras Lake Charles Pittsburgh Greenfield Brownfield Hong Kong Kitakyushu Pohang Trieste Yanbu Qinhuangdao Tangshan New Orleans Texas City Karachi Dalian Itaqui Grimsby Baton Rouge New MangaloreDeveloper Majority Busan Nagoya lianyungang Tubarao Beaumont Huntington Saldanha Bay Paradip Tampa Milford Haven Shenzhen Marseilles Constantza Jeddah Odessa South Louisiana Newcastle Mobile Tees Leghorn Acquisition Oil & Liquid Houston Kobe Hampton Roads Manila Paranagua Antwerp Amsterdam Ports St. Petersburg Alexandria Paulsboro Ulsan Osaka Valencia Taranto Tarragona Chiba Tanjung Pelepas Plaquemines Gothenburg Valdez Logistic Zone $100+ million Port Hedland Sepetiba Dunkirk Tampa Texas City Port Kelang Richards Bay Madras Jubail Liverpool Rizhao Hay Point Jawaharlal Nehru Tanjung Priok Savannah Yingkou Novorossisk Los Angeles Zeebrugge Brisbane Seed investor Free Zone Kaohsiung Inchon Tokyo Santos Genoa Calcutta Mormugao Durban Lubeck Pascagoula Yokohama Le Havre Izmit Duluth-Superior Angra dos Reis Minority $1+ billion
  20. 20. How can we help you… Each constituent have different needs as concerns the deal pyramid. Some look for solutions all the way from market intelligence to…relevant scope (2) closing actual deals, others only up to and including engagement of the relevant authorities and potential partners. Step 4 Deal Closing the deal 1-5 Lead Step 3 development Deal development 10-20Step 2 FocusedEngage the most relevant market engagement 50-100Step 1 Market intelligenceFocus among the many and scanning 1,000-5,000
  21. 21. APPENDIXJust a few of the many opportunities
  22. 22. Market development……port expansion and new ports potentialPort zones are natural growthengines for the economy. Thepotential to develop and Port Property Dry Port Oil Storageexpand to generate economicgrowth and trade for most Bio Cruiseports far exceeds their currentfootprint. Fuel Logistic Bulk ZoneThis includes the developmentof trade hubs, freezones, industry zones and Trade Energyother concepts. Hub HubFor investors this givespotential to invest in some of Intermodal Hub Free Zone In-Port Industriesthe most valuable industryproperty and portinfrastructure.
  23. 23. Market development……acquisition potentialAmong the big acquisitionopportunities are theportfolios of many shipping …just a few examples…lines that are expected to Target Transaction value Acquiring partyface a difficult period and Portek portfolio $146mn Mitsui Tin Can Container Terminal (Zim lines $154mn China Merchantsport owners - some of which 47.5% share)are looking to do a.o. PPP Malta Freeport (CMA CGMs 50% share) $285mn Yildirim Group DPW Australia portfolio (75% share) $1.5bn Citi Infrastructure Investorstype deals that essentially Chennai International Terminals (Sicals Not reported PSA Internationalare asset sales. 27% sare) ACS Dragados Spanish port portfolio €720mn JP Morgan led consortium Yantian International Container $520mn Cosco PacificMany single asset owners Terminals (APM Terminals 9.7% share) Poti Sea Port (80% share) Not reported APM Terminalsalso sit with acquisition Santos - BTP (50% from MSC) Not reported APM Terminalsopportunities, some with fullownership of a terminal or aport and some with majorityor minority holdings inspecific assets.
  24. 24. Market development……collaboration potential (1)Greenfield MATCHING $1bn Over the course of a port infrastructure project • Private Equity the nature of the investment changes from stage • Construction Development Company Port Group to stage. Investors (as well as operators and developers) all have different preferences, some Oil are more suitable for green-field whereas others • Investment Operator look for mature facilities. Likewise each Fund Growth • Operator constituent brings its own set of strengths and Container skills to the table that amongst others can allow Operator the undertaking of larger projects. • Pension Fund Bulk Maturity Operator SYNGERGIZING (1 + 1 = 3) Ultimately this is all about finding synergies Investment between parties with different skills and needs to Fund accelerate development that may not otherwise have been possible or less attractive.
  25. 25. Market development……collaboration potential (2)The port industry has TERMINAL OPERATORSthousands of different APM Terminalsoperators and port owners that Oiltankingare ready to collaborate for ICTSIdifferent types of projects at Vopakdifferent stages of the projectin different geographies. PORT OWNERS Port of RotterdamLikewise on the side of the Shanghai International Port Groupparties actually owning cargo Abu Dhabi Terminal Companythere are many that either Santos Port Grouphave a need to get bettermarket access on the sea side CARGO OWNERSor have existing facilities that Shipping linesthey wish to outsource. Mining and mineral companies Energy companies Industrial Zones
  26. 26. Market development……collaboration potential (3)The global investment fund INVESTMENT FUNDS AND PRIVATE EQUITYsector manages more than Macquarie Infrastructure Group$100 trillion. Many want to “get Brookfield Infrastructure Partnersreal” (assets) and “go direct” JP Morgan Infrastructure Fund(ownership) - they want real Citi Capital Advisorsassets with real purpose.Owners or developers of port SOVEREIGN FUNDSassets are in an ideal position to Abu Dhabi Investment Authoritytap into that. China Investment Corporation Government of Singapore Investment CorporationMany of the major funds prefer Malaysia Mining Corporationgetting in after the developmentand optimization of a given port PENSION AND INSURANCE FUNDSasset and want substantial deal Ping An (2nd biggest Chinese insurance fund)size - often $100+ million. Ontario Teachers Pension Fund ATP (biggest Danish fund) APG (biggest Dutch fund, 3rd biggest globally)
  27. 27. Market development……collaboration potential (4)IMMEDIATE COVERAGE FOR INVESTORSFor those with an interest to The PI Consortiumenter, expand or invest in a specific A new model for investors, developers and operatorsregion (e.g. China) and covering all thekey markets within months. Shipping lines Asia Industrials Latin AmericaREAL ENGAGEMENT Fabrication Middle EastOur on the ground network directlyengages the local decision makers CARGO OWNERS PORT PARTNERSCOMPLEMENTARYA group of leading firms withcomplementary skills and objectives CONSORTIUMenabling a strong proposition towardsports. DEVELOPERS INVESTORS OPERATORSSYNERGISTIC AND NO RISKNo heavy regional setup or local office Free Zone Pension Fund Containerbefore you start running Marine Infra. Private Equity Oil & Liquid Construction Sovereign Fund Dry Bulk
  28. 28. APPENDIXThe deal pyramid step by step
  29. 29. The PI Deal Pyramid… Step 4…an overview Deal Closing the deal $1bn Develop Step 3 Deal development 10-20 Step 2 Engage Engage the most relevant 50-100 Step 1 Focus Market intelligence and scanning 1,000-5,000 Step 0 Purpose Target Proposition Create the foundation
  30. 30. Step 0……defining purposeWhat is the purpose?Why are you looking foranacquisition, developments or partnerships? Purpose
  31. 31. Step 0……identifying the targetWhat specifically isrelevant for you totarget, who to partnerwith or what todevelop? Purpose Target
  32. 32. Step 0……creating the propositionWith the target in mindwhat is your propositionto them? Why shouldsomeone welcome yourinvestment, collaborateor partner with you? Purpose Target Proposition
  33. 33. Step 1……focus DealThis is about gettingyour market intelligence Developand scanning in place. Itis about getting theright targets in sight. Expose and EngageWithout it you aregoing to be wastingvaluable time andresources while others Focuscut deals. 1,000-5,000 Purpose Target Proposition
  34. 34. Step 2……engagement DealThis is about creatingtrue engagement – it is Developnot about desk researchit is about on theground direct contact Engagewith the real decisionmakers and getting 50-100your proposition outthere in the right form. Focus 1,000-5,000 Purpose Target Proposition
  35. 35. Step 3……development DealThis is about fast-tracking and developing Developreal leads, creatingsubstantial 10-20opportunities and Engagecreating real leverageto close the deal. 50-100 Focus 1,000-5,000 Purpose Target Proposition
  36. 36. Step 4……deal Deal $1bnGoal! Now use all the greatefforts you did in step 0 to 3 Developto make many more! 10-20 Engage 50-100 Focus 1,000-5,000 Purpose Target Proposition
  37. 37. APPENDIX About Port Investor
  38. 38. InduStreams was founded in 2011 with a mission to create a more transparent, connected and informed infrastructure market place. We launched in July 2011, a specific sector pilot with focus on port investing and the global port industry. Current state of affairs  200+ port groups and 1,000+ executives and decision makers in the network and increasing  China Port Investor and other regions are being launched  Specific concepts in development with select investors and port groups The Vision  Connecting all substantial port markets (5,000+ globally) with investors (1,000+ globally)  Creating a transparent and informed market place driven by industry leaders and experts  Unleashing the potential inherent in this sector by creating thousands of new investment opportunities (we expect investment potential to exceed $1 trillion) Want to know more or simply engage… …contact us on: