SUVA— 5 November 2015—The Fijian Government will divest 59% of the shares in Fiji Ports Corporation Limited (FPCL) at a value of more than FJ$100 million.
The legal agreements were signed today by the Hon Prime Minister of Fiji, J V Bainimarama, and the consortium comprising representatives of FNPF and Sri Lankan corporation Aitken Spence PLC, for the partial divestiture.
Prime Minister Bainimarama said that the transaction is a great step forward in the Government’s asset sale divestments.
Government will maintain 41% of the shares in FPCL, while FNPF will own 39% and Aitken Spence 20%.
Following the divestment, 80% of the shares in FPCL will remain Fijian owned.
Under the agreements, Government will receive more than FJ$100 million for 59% of the shares in FPCL. The consortium of FNPF and Aitken Spence will pay FJ$99,112,330, and the Government will also receive approximately FJ$3.3 million from the sale of land to Fiji Roads Authority for the realignment of the road and bridge at Stinson Parade, Suva and FJ$2.38 million from the repayment of an inter-company loan.
Minister for Public Enterprises Hon. Aiyaz Sayed-Khaiyum said the Government’s objective for the divestiture is to secure the partnership of a long term investor in FPCL that would contribute to the development and growth of FPCL’s asset base and continue the improvement of Fiji’s sea ports, including their expansion, modernisation and development of specialised facilities.
“This divestiture promises to make FPCL more profitable and efficient, and will ensure that international best practices, processes and systems will be introduced that will position Fiji’s ports as regional and international hubs,” Minister Sayed-Khaiyum said.
The Minister described Aitken Spence as a credible investor with a stellar international reputation. Not only does the organisation have experience in port management, they also have a proven track record in Fiji where they have already helped improve the performance of Fiji Ports Terminal Limited.
“Government has undertaken a number of strategic divestitures to ensure that the expertise and the profit motive that drives the private sector can be used to Fiji’s advantage,” he elaborated. “We are taking a pragmatic approach and bringing the private sector in to do the things the private sector does best. This sort of collaboration between the private and public sector can be a model in the future.”
He said that FPCL management and Aitken Spence would prepare a master plan to develop the ports of Fiji, and that Government expected the ports to generate real job growth in all associated sectors of the economy.
As part of the agreements, FPCL will transfer all real estate to a government holding company, which in turn will lease the assets necessary for port operations back to FPCL. Ownership of all land interests will remain with the Fijian Government.
Aitken Spence has been recognised for three consecutive years by Forbes as one of the most successful publicly-traded companies with annual sales under US$1 billion outside of the United States. It has been a partner in Fiji Ports Terminal Limited since August 2013. In that time, it has increased productivity by 60%, improved vessel turnaround time by 33% and increased net profit by 49.5%, amounting to an increase in net profits to FJ$2,773,235, in its first year of operations.
FNPF is Fiji’s largest financial institution, with total assets valued at FJ$4.9 billion.