AIG acts to boost its port business

Buyer of P&O Ports to acquire Amports, import car handler

By Meredith Cohn | Sun reporter

April 27, 2007

Gaining a bigger stake in the Baltimore waterfront, AIG Global Investment Group said yesterday that it is buying the auto processing company Amports for an undisclosed sum from a New York-based equity fund.

AIG also was the company that recently bought P&O Ports from the Dubai government. It marks the first major deal since AIG closed on the deal in March.

Amports is among the largest handlers of imports and exports here and across the country. And automobiles are one of the top cargos for the Helen Delich Bentley Port of Baltimore. It handles Chrysler, General Motors and Ford models on their way overseas and Volvos, Jaguars, Suzukis, Toyotas and Hondas coming into the country.

P&O Ports, now called Ports America, also has operations across the country, but it and Amports overlap only in Baltimore. While AIG officials view the pair as complementary, they plan to continue running the businesses separately.

No immediate job losses or gains are planned.

And though Amports has limited space, it hopes over time to move cars more quickly and increase the cargo it can handle and the people it employs.

Amports receives autos imported by ship mainly to the port's Fairfield terminal and also to Dundalk Marine Terminal.

The company ensures that the cars work and also installs parts, cleans and paints cars, then puts them on trains and trucks that transport them to dealerships.

Ports America manages the state's nearby Seagirt Marine Terminal, which handles mainly containerized cargo that comes and goes by ship, truck and train.

"We want to be the best port business in America," said Christopher Lee, managing partner of AIG Highstar Capital, the AIG investment arm that is buying Amports. "We obviously did an extensive analysis of both businesses. We see real growth potential."

Lee said that once this deal closes, expected in three weeks, AIG would be looking to make more maritime-related acquisitions.

The company bought Amports from an affiliate of New York-based Lincolnshire Management Inc., which had just bought the Jacksonville, Fla.-based Amports for $107.8 million last June. The previous owner was Associated British Ports, the United Kingdom's largest terminal operator.

Lincolnshire already owned rival auto processor ATC Logistics, which was run separately and not part of the auction for Amports. Lincolnshire did not respond to requests for comment.

The two processors are among the largest in Baltimore. In 2006, those and other processors at the port handled 474,536 autos, up from 461,991 in 2005, according to port officials. That made Baltimore second in auto exports among the nation's ports, and third in auto handling overall behind New York and Jacksonville.

"AIG is a quality group and continues to show interest in maritime interests," said F. Brooks Royster III, executive director of the Maryland Port Administration.

"We're interested in having quality and well-funded business partners. That allows for further and greater investment in their operations.

"It's also important that they have continuity," Royster continued. "And by maintaining the management teams that assure continuity."