Global investment group buys Eddystone port

Penn Terminals Inc., a busy seaport in Delaware County, is being acquired by a deep-pockets global investment fund that plans to invest in its long-range growth.

Macquarie Infrastructure Partners and Penn Terminals officials said today that a sales agreement had been signed, but they would not disclose the financial terms.

Macquarie is a $4 billion fund based in New York, with investors mostly from the United States and Canada. It is managed by the Macquarie Group Ltd., of Sydney, Australia.

Alex Doughty, a corporate communications officer for Macquarie, said the company would make major investments over time to expand and improve the 71.4-acre facility. The details of those plans will be mapped out after the transaction is completed next month.

"We take the long-term view. We don't have excessively high short-term-return expectations," Doughty said.

John H. Estey, chairman of the Philadelphia Regional Port Authority and Gov. Rendell's point person on maritime issues, said the transaction "shows that investment firms are serious about the growth of traffic in and out of the river."

Estey, a partner at the law firm Ballard, Spahr, Andrews & Ingersoll L.L.P., said Macquarie's decision would be helpful when he talked to others about building maritime facilities here.

State Rep. William F. Keller (D., Phila.), chairman of the Delaware River Maritime Enterprise Council, said the deal boded well for the whole river.

"This just proves . . . that the Port of Philadelphia is the next place where maritime transportation will grow and prosper. Private industry is now willing to come into [the] Delaware River and spend private money to build marine terminals," Keller said.

In the past, general cargo docks have been built with big government subsidies.

Penn Terminals occupies part of the old Sun Shipbuilding & Dry Dock Co. That yard, established by the Pew family, which founded what is now Sunoco Inc., operated from 1917 to 1982. At its peak, it employed 40,000 people. It was one of the nation's five-largest shipyards and a major builder of oil-tanker ships for World War II.

Penn Terminals has 1,150 feet of dock, 2,300 feet of railroad siding and a large refrigerated warehouse where weekly shiploads of bananas and other fruit from South America are briefly stored.

According to maritime-industry reports, 268 cargo ships docked there last year. Its main customers are Independent Container Line Ltd., of Richmond, Va.; Seaboard Marine Ltd., a unit of Seaboard Corp., of Shawnee Mission, Kan.; and C.I. Banacol S.A., of Colombia.

"These are strong clients with good prospects. We will continue to cultivate long-term relationships and help them grow," Doughty said.

Greg Hopper, president of Penn Terminals, could not be reached for comment.

The International Brotherhood of Boilermakers, the union that once represented shipyard workers at the site, has maintained jurisdiction over the terminal, which employs about 150 people.

In its early years, Penn Terminals sought to grab market share with low costs. But in recent years, its owner, City Capital Corp., a consortium of investors based in New Orleans, has shifted the focus to providing customer service and improving the quality of business.

The Macquarie Group describes itself as a "diversified international provider of banking, financial, investment and advisory services." It is a major investor in infrastructure projects at 116 sites in 25 countries. Penn Terminals would be the group's 12th seaport.