ABU DHABI : East Africa Gateway Ltd, an associate company of Adani Ports and Special Economic Zone Ltd (APSEZ) incorporated in the United Arab Emirates, has agreed to buy Tanzania International Container Terminal Services Ltd (TICTS), which runs a container terminal at Tanzania’s main port of Dar es Salaam and the deal is being scrutinised, the East African nation’s Fair Competition Commission (FCC) has said.
Tanzania’s antitrust regulator said in a public notice on 6 February that it had received a notification from East Africa Gateway Ltd to acquire the entire equity of Tanzania International Container Terminal Services, whose founding directors include local businessmen Nazir Karamagi and Yogesh Manek. Karamagi is also a politician who was a former minister in the Tanzanian government.
In July last year, APSEZ was close to acquiring a facility at Dar es Salaam Port, which handles some 95 percent of Tanzania’s international trade shipped by sea.
The FCC said in the public notice it has begun the “review and investigation of the intended acquisition with a view to examining whether it is likely to harm competition”.
The deal, when announced, would be the third port acquisition globally by APSEZ in recent years after Haifa Port in Israel and an under-construction container terminal in Colombo Port.
Since January 2023, APSEZ was hired by Tanzania Ports Authority to run four container handling berths (8 to 11) at Dar es Salaam Port as a service provider, after its five-year contract with Tanzania International Container Terminal Services (TICTS), a unit of Hong Kong’s Hutchison Port Holdings Ltd, ended.
Hutchison Port, owned Hong Kong billionaire Li Ka- shing, operated the container terminal at the Dar es Salaam port for 22 years until the Tanzanian government decided not to renew its contract last year.
Dar es Salaam Port has a rated capacity of 14.1 million tonnes (mt) dry cargo and 6 million tonnes of bulk liquid cargo. The port has a total quay (berth) length of about 2,600 metres with eleven deepwater berths.
Dar es Salaam Port is the main gateway to Tanzania’s hinterland and the Great Lakes region. It also plays a major role in supporting the economies of the neighbouring landlocked countries of Zambia, Democratic Republic of Congo, Burundi, Rwanda, Malawi, Uganda, and Zimbabwe.
Besides, the port is strategically located to serve as a freight link to and from East and Central Africa countries as well as to Middle and Far East, Europe, Australia, and America.
East Africa Gateway Ltd was incorporated on 3 October 2023, as an associate company, APSEZ said while announcing the October-December quarterly financial results on 1 February.
The formation of East Africa Gateway Ltd in the UAE confirms that APSEZ has teamed up with Abu Dhabi Ports Group to acquire Tanzania International Container Terminal Services. As a precursor to the acquisition of TICTS at Dar es Salaam Port, APSEZ and Abu Dhabi Ports Group signed a memorandum of Understanding in August 2022 for pursuing strategic joint investments in end-to-end logistics infrastructure and solutions, including rail, maritime services, port operations, digital services, industrial zone, and the establishment of maritime academies in Tanzania.
The agreement set in motion a series of potential country-level investments to grow, improve, and promote an end-to-end maritime and logistics ecosystem which will make Tanzania a hub for the African region, the two companies said after signing the MoU to pursue the collaboration.
“This MoU with Adani Ports and SEZ Ltd is significant in its impact on both Tanzania’s ability to transform itself into an African trading hub, as well as our ability to further develop our global capabilities and connections that will bring goods to market faster and more efficiently,” Capt Mohamed Juma Al Shamisi, Managing Director and Group CEO, AD Ports Group, said after signing the MoU.
“Our strategic investment in Tanzania in infrastructure and solutions will enable international companies to enter African markets. In line with the direction of the UAE’s leadership, we are positioning Abu Dhabi as a global leader in logistics and industry,” he added.
APSEZ then CEO and now Managing Director Karan Adani said that partnering with the “AD Ports Group in the development of key quality infrastructure in Tanzania especially in the ports and maritime sector will improve and bring about positive change in the communities”.
“We continue to support local employment, as well as general economic growth in Tanzania and East African countries that will benefit from our investments through the collaboration with AD Ports Group,” Karan Adani said.
Abu Dhabi Securities Exchange listed A D Ports Group, a part of Abu Dhabi Developmental Holding Company, is one of the region’s largest holding companies based in the capital of the United Arab Emirates.