HK firm takes stake in Malaysian port

HK firm takes stake in Malaysian port

KUALA LUMPUR (AFP): Hong Kong-based Hutchison Port Holdings (HPH) has bought a major stake in one of Malaysia's largest container ports, it was announced Wednesday.

HPH, which operates 18 ports worldwide, said in a statement it had bought a 30 percent stake in Westport at Port Klang.

A source said the company paid 400 million ringgit (US$105 million) for the stake in Westport Holdings, which owns port operator Klang Multi Terminal.

Analysts said the investment would raise efficiency at Westport and allow Malaysia to further challenge Singapore's status as the regional shipping hub.

In August the giant container line Maersk Sealand said it was shifting its regional transshipment hub to Tanjung Pelepas in Malaysia from Singapore.

HPH is a subsidiary of Hong Kong tycoon Li Ka-shing's Hutchison Whampoa group. Malaysia's Foreign Investment Committee earlier gave the go-ahead for the purchase.

"We are excited about the prospects ahead for Westport and we look forward to using combined expertise and resources to develop Westport into a world-class operation," said John Meredith, HPH's group managing director, in the statement.

Nik Ibrahim, chairman of Westport Holdings, said the aim was "to expand Westport into a megahub center providing efficient and reliable deepwater berthing and handling services second to none in the region.

"Westport will be able to tap into markets that were previously far beyond its reach. The opportunity for expansion is boundless," he said.

HPH owns ports in Myanmar, Indonesia, Hong Kong and the rest of China, the Americas, the Netherlands and Britain.

Nik Ibrahim said the partnership with HPH would allow Westport to standardize technology, IT systems, operating procedures and productivity with 18 ports worldwide.

"HPH has ventured into Indonesia. Now Malaysia ... they seem to expanding," said Janice Chua, shipping analyst at Vickers Ballas in Singapore.

"In time to come, Westport will be a threat to Singapore in terms of transshipment cargo," she told AFP.

Michael Chen, former chairman of the Port Klang Authority, said HPH's entry into Malaysia was a boon for the local shipping industry.

"They bring along new technology and a new culture to boost port efficiency," he said.

Chen, a former transport minister, said it has "never been our intention to challenge Singapore." But he said the deal would attract more cargo to Malaysia, which offered lower charges than Singapore.