ICTSI wades into freight forwarding

Global port operator International Container Terminal Services Inc., owned and controlled by tycoon Enrique K. Razon, Jr., is foraying into the freight forwarding business through a P25-million consolidation of its units Prime Alta Holdings Inc. and Abbotsford Holdings Inc.

In a disclosure to the stock exchange, ICTSI said its subsidiaries forged a business partnership to establish a new company, which will be named Fortune Logistics Corporation.

The JV company will operate, engage in and carry on the business of domestic and international ocean, air, and land freight forwarding and logistics.

The new venture, according to ICTSI's stock report, is expected to reduce costs and improve operational efficiency associated with the processing of cargo used by ICTSI for its various operations nationwide.

SEC application sent

Under their agreement, ICTSI, through AHI, will effectively own P12.75 million or 51 percent of the total shareholdings in the JV company, while Prime Alta Holdings will own the remaining 49 percent or P12.25 million worth of initial subscription.

The partners will register the JV company with the SEC and obtain approval for its incorporation and commence operations immediately.

SEC approval and other standard regulatory permits and licenses should be obtained within one to two months from the JV signing.

ICTSI recently announced that its revenue from its global port operations for the first half of the year reached $1.06 billion, higher by 20 percent from the $882.6 million a year ago.

The company said the topline improvement was due to volume growth at most terminals, new contracts with shipping lines and services, higher revenues from ancillary services, and contribution of new terminals.