Target Overview

Infracapital, the infrastructure equity investment division of M&G Plc, has finalized an agreement to acquire a 66.67% stake in CTH, a prominent Dutch operator of inland ports and rail terminals. This move will enable Infracapital to increase its ownership in CTH to a full 100%. Infracapital initially acquired a 33.33% interest in CTH through its 2021 purchase of Multimodal Container Services B.V. (MCS). The acquisition is executed through Infracapital’s Benelux inland container terminal platform, known as Inland Terminals Group (ITG).

CTH, headquartered in Hengelo, operates two strategically located inland terminals in the Netherlands, geographically situated to bolster the existing ITG catchment areas. These terminals provide direct services to the Port of Rotterdam, enhancing the operational synergies within ITG. Furthermore, CTH operates a rail terminal in the Pernis area of the Port of Rotterdam, extending services to rail operators across Europe.

Industry Overview in the Netherlands

The inland shipping and rail sector has been witnessing an upward trajectory in the Dutch logistics market, driven by its significantly lower carbon emissions compared to road transport. This segment is experiencing robust political support, aligning with initiatives aimed at reducing road congestion and achieving decarbonization targets. As a result, the market for inland shipping and rail services is expected to grow, reflecting a shift in logistics practices.

Increasingly, this modal shift from road to rail and inland waterways is anticipated to reshape the logistics landscape in the Benelux region, particularly with respect to transport services stemming from Rotterdam. The expansion of multi-modal operations is bolstered by investment in infrastructure, which reinforces the importance of sustainability and efficiency in the logistics domain.

CTH’s inclusion within Infracapital's portfolio emphasizes the growing importance of sustainable logistics solutions that contribute to environmental goals. The integration of CTH into the ITG network is expected to be synergistic, leveraging CTH's terminals to offer enhanced logistical services while aligning with broader industry trends toward greener transportation modalities.

With Infracapital's strategic investments, such as those in BCTN and MCS in 2021, the foundation for a comprehensive intermodal transport ecosystem in the Benelux is becoming a reality. The consolidation of these entities under ITG focuses on providing cost-efficient, environmentally friendly alternatives for transporting goods inland.

Rationale Behind the Deal

This acquisition is in line with Infracapital’s proactive strategy to invest in sustainable infrastructure that meets evolving societal needs. By bringing CTH fully under its wing, Infracapital not only enhances its operational capabilities in the Netherlands but also positions itself favorably amid the rising demand for sustainable transport solutions.

The synergy created by integrating CTH into the existing ITG framework is expected to augment market share and operational efficiency. Ultimately, the cumulative effect of this acquisition supports long-term growth objectives for both Infracapital and the broader logistics ecosystem in the region.

Information About the Investor

Infracapital is renowned for its investment strategy focused on essential infrastructure aimed at catering to the changing demands of society. The firm actively participates in managing a diverse portfolio that aspires to foster stable and sustainable growth across Europe. With a team of experienced specialists, Infracapital has successfully worked alongside more than 60 companies across the continent, demonstrating a robust capability in deploying and managing significant capital.

As a segment of M&G Plc, Infracapital is well-equipped to handle substantial investments, having raised over €9 billion across various funds. This positioning allows Infracapital to not only influence the growth of its investments but also ensures adaptability to market fluctuations and evolving stakeholder needs.

View of Dealert

The acquisition of CTH by Infracapital is poised to be a strategic move that aligns well with current industry trends toward sustainability and efficiency in logistics. The integration of CTH into the ITG network strengthens the group's ability to address the impending shifts in the logistics landscape, particularly as the demand for greener transportation solutions rises.

This deal is likely to enhance ITG’s competitive positioning in the inland transport market, particularly given the expected growth in intermodal transport from Rotterdam. Infracapital's focus on sustainable infrastructure not only benefits its operational capabilities but creates a positive public perception as a leader in green logistics.

Moreover, with political and economic factors propelling the logistics sector towards greener practices, the timing for this acquisition appears opportunistic. The anticipated synergy and efficiency gains from integrating CTH into ITG could result in improved service offerings and cost-effective solutions, further enhancing shareholder value over time.

In conclusion, this acquisition seems to be a prudent investment for Infracapital, positioning them strategically to capture the benefits of the evolving logistics market while contributing positively to environmental objectives. Therefore, this deal is likely to yield favorable returns and provide a foundation for long-term growth within the industry.

View Original Article