MTBS-advised COSCO Shipping Ports Take 60% Stake in Chancay Terminal, Peru

COSCO SHIPPING Ports Limited (“CSP”) has announced that it will acquire a 60% stake in Terminales Portuarios Chancay S.A. (Chancay Terminal) from Volcan Compañía Minera S.A.A., (“Volcan”) for a total consideration of US$225million, with an initial payment of US$56million. The port of Chancay is a Greenfield Port Development Project in Peru, 55km North of Callao. The Project represents CSP’s first venture into Latin America.

MTBS has provided advisory services to CSP on this assignment. MTBS has conducted the Commercial Due Diligence, including the development of the traffic forecast, tariff projections and hinterland assessment. In addition, MTBS developed the Financial Model for CSP, and advised on the appropriate costing assumptions for the development of the Project.

The Port of Chancay

Economic growth of Peru has continued in recent years; container throughout of Peru in 2017 has increased to 2.5 million TEU from 1.5 million TEU in 2010. Located 58 km in the north of the Peruvian capital of Lima, Port of Chancay enjoys favourable location where it has easy access to the economic centre of Peru. About 60% of Peru’s economic activities are concentrated in Lima and its surrounding areas, and thus, the favourable geographic location of Lima is of strategic importance.

Port of Chancay is a natural deep-water harbour with a maximum of 16 meters water-depth and is capable of satisfying the needs of mega vessels. The construction of Chancay Terminal includes multi-purpose terminals, container terminals and related infrastructure facilities. Phase one of the terminal will have four berths, of which two are multi-purpose berths, and two are container berths with a total annual designed capacity of one million TEU.

For more information, we refer to: CSP Press Release and Volcan.