International bidders reportedly closing in on deal to acquire Haifa port

Acquisition of Israel’s busiest shipping hub will likely cost some $600 million and close by the end of 2021, Reuters reports

Luke Tress is an editor and a reporter in New York for The Times of Israel.

Haifa bay, April 24, 2018. (Yossi Zamir/Flash90)
Haifa bay, April 24, 2018. (Yossi Zamir/Flash90)

Several international bidders are reportedly lining up to acquire Haifa’s port in a massive deal that is expected to close by the end of the year.

Investment groups from Israel, Europe, India and the United Arab Emirates are contending for the deal, which is estimated to be worth as much as $600 million, according to a Monday Reuters report. Haifa’s port is the busiest shipping hub in Israel.

The firms are expected to place formal bids in October, the report said, citing “sources with knowledge of the matter.” Authorities will likely announce a winner before the year ends, and transfer ownership at the beginning of next year.

The Israeli government voted last year to move forward with privatizing Haifa’s port in an attempt to spur competition and decrease costs.

Among the bidders are Israel’s Shipyards Industries, which has partnered in the initiative with Dubai’s DP World.

Israel normalized ties with the UAE last year, opening up trade between Israel and the Gulf that will likely further boost business at Haifa and in the region.

Shipyard Industries and DP World have also discussed exploring a direct shipping route from Dubai’s massive Jebel Ali port to Eilat.

Also in the running is the UK’s DAO Shipping, which paired up with Israel’s Generation Capital and the London-based Lomar.

Adani Ports, an Indian firm, has teamed with Israel’s Gadot Group, and a fourth bidder is working with Israel’s Shafir Engineering, Reuters reported.

The winning bidder will need to compete with a Chinese-operated shipping terminal nearby that is set to open by the end of the year. Israel is selling the existing Haifa port with some benefits, including financial incentives and land to develop, to better compete with the Chinese-run facility.

China’s Shanghai International Port Group is set to operate the new commercial shipping facility under construction in Haifa near the existing port, an arrangement that has stoked controversy in Israel and abroad.

The project’s proximity to Israel’s submarines, among other issues, raised security concerns, especially after reports revealed that neither the cabinet nor the National Security Council had any input on the deal.

The Chinese project also raised the ire of the US, which sometimes docks military vessels in Haifa.

Last year, eighteen applications were filed for the acquisition of the existing port, indicating a high level of interest in the project. Contrary to expectations, none of the applicants were based in China.

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