LONG BEACH CONTAINER TERMINAL SALE DUE DILIGENCE

The brief. Black Quay delivered all technical advisory due diligence on the sale of Long Beach Container Terminal, the most advanced fully automated container terminal in the world, handling over 3.3 million TEU, and provided advice to the buyer on how to futureproof the facility.

The challenge. The sale was not initially commercially motivated. It was a compelled divestment: OOCL's parent was required to transfer ownership under a National Security Agreement with the US Departments of Homeland Security and Justice, following Cosco Shipping's acquisition of the group.

A forced sale on a fixed timetable put unusual weight on the technical case. Bidders needed to understand not only what the terminal produced but what its automation regime could be made to produce, and over what investment horizon, a comparison with very few precedents.

What we did. We delivered all technical due diligence on the project.

That included detailed operational capacity modelling of the automated terminal, assessment of its comparative productivity, automation impact analysis, and enhancement analysis identifying how the terminal could be expanded and capacity increased over agreed investment timeframes.

We produced equipment capital and operating cost reviews, detailed opex and capex calculations, and asset condition and asset life assessments across landside and waterside.

Alongside the terminal work we delivered advanced fleet forecasting on a twenty-five-year horizon, terminal competitor reviews, shipping trend and transport initiative reviews, stakeholder and infrastructure needs studies, assessment of labour productivity and improvement strategies, operational and technical investment risk reviews, North American trade movement analysis and future-state assessment of consumption, manufacturing and inland transport.

The outcome. The terminal was sold in April 2019 to a consortium led by Macquarie Infrastructure Partners for US$1.78 billion, alongside a twenty-year stevedoring and terminal services agreement with OOCL.

 

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