BIZ BUZZ: Razon cries foul

Global port operator International Container Terminal Services Inc.’s (ICTSI) bid to take over the operations and maintenance of Durban Container Terminal (DCT) Pier 2 at the Port of Durban has hit a stumbling block.

Last year, the port operator was chosen as the preferred bidder by Transnet SOC Ltd.—a South African government state-owned company—to operate and develop the seaport that handles 72 percent of the Port of Durban’s throughput and 46 percent of South Africa’s port traffic.

But Maersk Group—one of the losing bidders—filed a legal petition seeking the disqualification of the Razon-led operator for allegedly not meeting the required solvency level, according to reports.

As a result, the Kwazulu Natal Division of the High Court of Africa issued a prohibition against Transnet’s selection of ICTSI until the petition is resolved.

“We outbid Maersk by $100 million and they are attempting to use a nonessential technicality to ensure that the Government of South Africa does not succeed with part of its economic agenda,” tycoon Enrique Razon Jr. said in a strongly worded statement.

Razon said the Maersk group’s petition was its way of holding on to power, saying the logistics company has been dominating the South African market after buying freight service operator SAF Marine two decades ago.

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“Maersk is clearly desperate to prevent the entry of an independent common user terminal operator. In short, after failing to produce a strong bid, they are instead trying to delay and stop the process by using the Courts,” Razon said.

For now, the project has remained suspended, which means delays in the implementation of port upgrades that can boost cargo volume.

“These delays will curtail the operational recovery and make it more and more difficult for any private partner to succeed,” Razon said.