Hilton to take helm of DPWA as DP World increases stake


Dubai-based port operator to regain majority as Scurrah's replacement accounced

Hilton to take helm of DPWA as DP World increases stake
Glen Hilton

 

DP World has announced that it has acquired an additional stake in DP World Australia (DPWA) from Gateway Infrastructure Investments and other financial investors.

The acquisition is subject to regulatory approval but would value DPWA at about $1.4 billion.

Private equity firm Corsair Infrastructure Partners (CIP), manager of Gateway, will continue to hold a stake in DPWA through other managed funds.

As recently as December, reports stated DP World, the original parent of DPWA, had been looking to move back to at least 51 per cent control of DPWA from 25 per cent, spending at least $250 million buying back shares it sold in 2010.

DPWA is expected to be earnings neutral in the first full year of ownership, DP World says.

"We are pleased to announce this transaction that brings DP World Australia back into our consolidated portfolio, which presents a more optimal structure to drive this business forward, while continuing our relationship with CIP as a valued partner," DP World group chairman and CEO Sultan Ahmed Bin Sulayem says.

"We remain optimistic on the growth prospects in Australia and believe there is an exciting opportunity to enhance shareholder value by further developing the container terminals operations and expanding beyond the ports into logistics services."


Read more about DP World's charge increases at the start of this year, here


Glen Hilton will take the helm of DPWA, replacing the outgoing MD and CEO Paul Scurrah, whose five-year contract ended late last year.

Hilton was most recently CEO at Port of Tanjung Pelepas in Malaysia but has held various roles at DP World previously, including as south-east Asia MD and GM of Caucedo in the Dominican Republic. He was also CEO of CSX World Terminals’ local operation in Adelaide, which was acquired by DP World in 2005.

"I would like to thank my predecessor Paul Scurrah who has been at the helm for five years during which he has driven some significant and important changes – particularly around people safety, culture and an unrelenting focus on our customers," Hilton says. 

"Safety, culture and customers will always be the foundation of our businesses and I am committed to building on Paul’s legacy.

"It’s great to return to both Australia and to DP World. Whilst most companies strive for growth, DP World’s Founder’s Principles are results oriented and geared for growth, which is exciting.  

"Many of you may be wondering if I have plans to make changes at DPWA or to set a new direction, particularly as we are operating in an increasingly competitive environment. 

"The consolidation of the shipping industry, surplus capacity of automated competitors and higher property costs have been challenging for Australian stevedores and DPWA is no exception.  

"I take enormous confidence in DP World’s decision to assume majority ownership of our business.  It’s a commitment to the business and the strongest possible vote of confidence in our ability to succeed and to grow.  

"That said, we must respect the reality of the bottom line which is telling us we simply cannot afford to stand still. 

"We must make the most of the assets we have, leverage the global expertise and scale of DP World which is at our disposal, build on our strengths and be prepared to consider new ways of working to ensure the sustainability and ongoing success of DPWA.  

"I have a great passion for our industry and I look forward to bringing my experience to DPWA as we continue to meet the challenges of growing our business by delivering our core services productively."  

Container Transport Alliance Australia (CTAA) welcomes Hilton’s appointment.

 "It’s refreshing that DP World has chosen a CEO with extensive stevedore terminal management experience." CTAA director Neil Chambers says in a statement.

"This bodes well for the new DPWA management structure under Glen having a full appreciation of the landside interface issues needing to be addressed in all DP World terminals to improve overall operational performance."

"Glen will be inheriting an organisation which is levying the largest landside infrastructure charges of any of its stevedoring competitors. It’s imperative that investments and operational relationships are strengthened to demonstrate a renewed commitment to improving the landside interfaces.

"The fact that DP World Dubai has taken back a majority financial stake-hold in the Australian operations is also a good sign."

"From his time managing the container terminal in Adelaide in the early 2000’s, through to his most recent role as CEO of the Port of Tanjung Pelepas in Malaysia, Glen will fully appreciate that quayside operations, the terminal container stack and the landside receival and delivery operations need to work in harmony to be truly effective.

"We look forward to DPWA having a renewed focus on landside transport operators (road & rail) as true 'customers' of the stevedore – relationships that must be nurtured if we are to achieve service and operational cost level improvements that are needed as container volumes in Australia grow."

"CTAA Alliance companies look forward to working with Glen and his revamped management team."

 

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