Saudi Arabia’s sovereign wealth fund, Public Investment Fund (PIF), and Chinese shipping company Cosco Shipping Ports have jointly acquired a 40 percent equity stake in Red Sea Gateway Terminal Limited (RSGT) for $280 million.
The investment will help to transform RSGT into both a regional and global logistics hub in line with PIF’s mission of unlocking new economic opportunities locally and globally. With the support of a leading global ports operator like CSPL, RSGT will benefit and expand its value proposition, and they will bring new momentum to the growth of RSGT’s business volume.
The RSGT is strategically located on major East-West trade routes, close to major cargo end destinations on Saudi Arabia’s west coast, and captures considerable intra-Red Sea trans-shipment cargo volumes. Both new shareholders will help drive future growth on seaside and landside logistics.
“This is a significant milestone for RSGT’s, demonstrating both our strength a business and the confidence which the industry and investment community have in our strategic planning and implementation. Working closely with PIF and CSPL, we will accelerate our shared vision, further strengthen our customer offering, and elevate our mandate to meet the increasing demand for terminal and logistics services. RSGT will continue to focus on developing a niche emerging market operator with a keen focus on ports in the Red Sea and East Africa.”
PIF is driving the diversification of Saudi Arabia’s economy, as the economic engine of Vision 2030. The investment in RSGT for a 20 percent stake comes in line with its 2021-2025 strategy that focuses on 13 key priority sectors, including transport and logistics.
According to the company, “Saudi Industrial Services Company, the kingdom’s leading strategic investor in ports and terminals, logistics parks and services, and water solutions, played a key role in the transaction with the divestment of its 21.2 percent direct equity stake in RSGT to PIF and Cosco.”
“Moving forward, a key element of RSGT’s ongoing development plan, beyond domestic and targeted international expansion, is to further develop our modern port and supply chain facilities enabling us to better meet the needs of our global and local customers”, added Mr. Floe.