AD Ports Group intends to launch Mandatory Tender Offer for Egypt's ALCN

AD Ports Group on Monday announced its intention to launch a cash Mandatory Tender Offer (MTO) to acquire an additional stake in Alexandria Container & Cargo Handling Company (ALCN), which would give it majority ownership and control of one of the largest container terminal operators in Egypt.

The control of ALCN, which operates two strategic Mediterranean terminals at Alexandria and El-Dekheila ports, will complement the Group’s expansion into Egypt and generate tangible financial returns for AD Ports Group.

To gain control over ALCN and have a successful transaction, AD Ports Group would need to acquire close to 32 per cent through the MTO.

The Group in November acquired its first position in ALCN, a 19.3 per cent stake, from Saudi Egyptian Investment Company’s (SEIC), a wholly-owned subsidiary of the Public Investment Fund (PIF) of Saudi Arabia, via a block trade.

The proposed transaction is expected to be completed in Q2 2026, subject to regulatory approvals in Egypt.

Under Egyptian securities exchange rules, AD Ports Group is required to make an MTO to all shareholders once it intends to acquire a third of ALCN.

Captain Mohamed Juma Al Shamisi, Managing Director and Group CEO of AD Ports Group, stated, “By acquiring a majority stake in ALCN, we would be maximising our engagement and expanding our operational footprint along one of the world’s most critical maritime routes. This investment would support our efforts to facilitate trade through this vital corridor, while deepening our partnerships and expanding our investments in Egypt, one of our fastest-growing foreign markets."

He added that this major strategic deployment in Egypt would be fully aligned with the leadership’s directives to drive economic diversification, strengthen regional integration, and deliver long-term value for our stakeholders.

Under the terms of the MTO, AD Ports Group will offer EGP22.99 per share, targeting a minimum uptake of close to 32 per cent to gain control over ALCN.

In light of AD Ports Group’s intention to acquire an additional stake in ALCN and to launch an MTO, the governmental shareholders, who hold most of the remaining shares in ALCN, will maintain their current respective shareholding stakes in ALCN.

AD Ports Group is exploring multiple financing options to fund the MTO and will opt for the most accretive one.

The acquisition of a majority stake in ALCN, whose FY2024-25 revenue would boost AD Ports Group’s top line by over 3 per cent, is expected to deliver significant strategic and financial benefits to the Group.

ALCN operates a highly profitable and cash-generative business, and boasts a healthy balance sheet, with an EGP9.7 billion ($195 million) net cash position (as of June 2025), reinforcing AD Ports Group’s liquidity and leverage position.

In FY2024-25, ALCN reported EGP8.37 billion ($168 million) in revenue and EGP5.36 billion ($108 million) in EBITDA, implying an EBITDA margin of 64 per cent, and generated EGP4.93 billion ($99 million) in Operating Cash Flow (OCF).

Established in 1984 and listed on the Egyptian Stock Exchange since 1995, ALCN has a combined container capacity of 1.5 million TEUs and throughput of 1.07 million TEUs, implying a utilisation rate of approximately 71 percent for the fiscal year ending 30th June 2025 (FY2024-25).

Its two terminals in Alexandria and El-Dekheila ports boast a total quay length of approximately 1.6 kilometres and are directly connected to Egypt’s national rail network, ensuring seamless multimodal connectivity for international shipping lines and regional trade. ALCN’s major customers include global shipping leaders such as Mediterranean Shipping Company (MSC), Evergreen Marine Corporation, and Hapag Lloyd AG.

The company is strategically active at a key crossroads of global commerce, with the Suez Canal handling 12 percent to 15 per cent of global trade annually, representing nearly 30 percent of global container traffic, according to The Atlantic Council.

The Alexandria region, anchored by ALCN’s operations, is central to this dynamic, with ALCN terminals accounting for approximately 60 percent of the area’s total container capacity.

The acquisition would unlock significant operational synergies by driving innovation in terminal management, digitalisation, and sustainability. Both Alexandria and El-Dekheilla terminals are equipped to handle large container vessels, and ALCN would benefit from AD Ports Group’s advanced technologies and best-in-class operational standards.

The direct rail connectivity of both terminals further enhances their role as vital hubs in Egypt’s and the region’s logistics ecosystem.

WAM