CIC among backers of Turkish port

Three Chinese investors are reported to have paid close to $1bn for a 65% stake in the country’s third-largest container terminal.

A group of three Chinese investors have acquired a 65 percent interest in Kumport, a modern container terminal on the European side of Istanbul in Turkey.

The purchase price was not officially disclosed, but media reports had previously estimated that it would be around $940 million. The remaining 35 percent is held by State General Reserve Fund, the Oman sovereign wealth fund.

The acquirers were: China Merchants, the state-owned corporation which in April last year acquired the long-term lease of Australia’s Port of Newcastle alongside Hastings Funds Management; COSCO, the Chinese shipping firm; and China Investment Corporation (CIC), the Chinese sovereign wealth fund.

According to a statement from Russia’s VTB Capital, which acted as financial adviser to China Merchants, the deal represents the largest investment from China into Turkey in 2015 and also the largest majority acquisition in the country so far this year.

Kumport is the third-largest container terminal in Turkey with a 17 percent market share and is situated along both the Silk Road Economic Belt and the 21st Maritime Silk Road of China. It acts as a gateway to the Black Sea region.

“We are delighted to be the partner of choice for China’s leading public port operator on this important cross-border investment into Turkey’s infrastructure, which is in alignment with the One Belt One Road initiative,” said Peter Stonor, head of transport, infrastructure and industrials at VTB Capital.

One Belt One Road is a development strategy first proposed by China in 2013 that focuses on connectivity and cross-border cooperation among countries in Eurasia.