The partnership agreement will see ICTSI operate the terminal while Transnet retains majority shareholding
Transnet and International Container Terminal Services (ICTSI) have today (11 December) officially signed a 25-year partnership agreement for the strategic Durban Container Terminal (DCT) Pier 2.
The agreement marks a ”pivotal moment” in the South African government’s economic reforms agenda, the two parties said in a statement, and Transnet’s strategy to bring the private sector into selective and strategically identified areas of the business.
ICTSI said the move is expected to enhance terminal productivity and increase throughput, ultimately improving the organisation’s operational efficiency and container supply chains.
It paves way for the joint partnership to manage the upgrade and development of Pier 2, which will take effect on 1 January 2026.
In terms of the agreement, Transnet holds a majority shareholding in a new special purpose vehicle, Newco, while ICTSI will be responsible for operation of the terminal.
Transnet selected ICTSI as the preferred bidder for the transaction in July 2023 following a rigorous and transparent procurement process.
Through the introduction of new equipment and advanced technology, DCT Pier 2 is expected to increase its capacity from 2mn to 2.8mn twenty-foot equivalent units (TEUs) and improve gross crane moves per hour from 18 to 28, as well as ship working hours from 60 to 120.
These improvements are envisaged to reduce logistics costs and improve service quality, thus broadening market access and attracting new volumes.
“Through our deliberate and expansive investment in new equipment across our terminals, the performance of DCT Pier 2 has been on an upwards trajectory,” said Transnet Group chief executive Michelle Phillips.
”We expect that our partnership with ICTSI will further propel this crucial terminal to its full potential.
”Private sector participation transactions are an important element of our strategy to modernise, expand and improve our key assets,” she explained.
”It is also a big step in our efforts to improve efficiencies across our terminals and transform our ports into world-class hubs.
”This is consistent with our approach to enhance efficiency and growth through strategic partnerships,” Phillips noted.
”Private sector participation in ports has the potential to positively influence efficiencies, export processes and global competitiveness.”
Hans-Ole Madsen, ICTSI’s senior vice president, said the partnership marks a shared commitment to revitalising South Africa’s maritime infrastructure and unlocking new opportunities for growth for both the country and the entire region.
”Pier 2 is a strategic asset for South Africa, critical to trade, jobs, and economic growth,” said Madsen.
”ICTSI is proud to invest in Durban’s future, bringing global expertise and technology to ensure DCT Pier 2 becomes a world-class terminal that benefits the entire region.
“We look forward to getting started, working closely with Transnet to execute our shared vision,” he added.
