Rough Waters

Jan 11, 2012 (LBO) – Sri Lanka’s Aitken Spence, may be forced to pullout from a container terminal project in Colombo after financing from a Chinese bank fell through, requiring additional financing from consortium partners, sources said. The new commitment would have been a further 130 million US dollars, which was beyond the capacity of the firm, which may force it to pull out of the consortium, source said.

In that event the terminal would be 85 percent owned by China Merchant Holdings. SLPA is expected to put in its share.

The terminal is being built by China Harbhour Engineering Corporation, which won the bid in a race with another Chinese firm. Colombo International Container Terminals (CICT) began construction of a 600 million US dollar Colombo’s expanded South harbhour last month.

The firm is 55 percent owned by China Merchant Holdings International, a state run Chinese firm, 30 percent by private listed Aitken Spence and 15 percent by the Sri Lanka Ports Authority, a Sri Lanka state-run firm.

The firm was negotiating a 350 million US dollars with China Development Bank (CDB) to build the terminal with its project cost escalating to 600 million dollars from an original plan of 450 million dollars, a source fam