Dubai Ports to buy UK ports co for $5.7 bn

The Gulf company’s offer price was a 46 per cent premium to P&O’s trading price before October 30 when P&O confirmed it had been approached by a potential bidder. P&O shares were up 0.5 per cent at 437-1/4 pence at 1250 GMT.

The deal follows a string of recent takeovers of major British companies. It is also the latest big purchase by Dubai-government-linked firms scouring the globe for assets to invest the Gulf emirate’s mountain of oil cash.

“I think this is an acceptable price. There is a lot of potential and brand value in the P&O assets, and Dubai Ports is well positioned to exploit it,” said Wadah Al Taha, a senior economic analyst at a bank in the neighboring emirate of Abu Dhabi.

PORTS GIANT

The Dubai Ports-P&O operation will be the world’s third-largest ports operator after Hong Kong’s Hutchison Whampoa at No.1 and Singapore government investment agency Temasek Holdings Pte Ltd in second place, it said.

Analysts said a rival bid now appeared unlikely. Hutchison, Temasek and Denmark’s Moeller-Maersk had been rumored as potential counter bidders.

“P&O’s board has unanimously recommended the offer and together with provisional acceptances for 19 per cent of the group’s shares a counter offer is unlikely,” Investec analyst John Lawson said.

Dubai Ports, created by the merger of two state-owned entities in September, said it planned to retain P&O’s management, staff and its UK-France ferries business. It said the deal was about expansion rather than cost-cutting. — Reuters