China’s Landbridge Group has bought a long-term lease on the Port of Darwin in Australia’s north for A$506 million (US$370 million).
The deal is part of Australia’s effort to capitalize on rising Chinese demand for imported food and overseas travel, The Wall Street Journal reported.
It follows another deal in which China Merchants Group teamed up with Australian fund manager Hastings Funds Management in April last year to buy the lease on the Port of Newcastle in New South Wales state, the world’s biggest coal export terminal, for A$1.75 billion.
“Through our significant investment in the Port of Darwin, Landbridge intends to grow two-way trade between Australia and Asia, leveraging Landbridge’s existing port and logistics businesses and firmly putting Darwin on the map for Chinese business,” Mike Hughes, director of Landbridge Infrastructure Australia, was quoted as saying.
Under the terms of the agreement, the Northern Territory government will lease the facility to Landbridge for 99 years as the territory seeks to put itself at the forefront of Australia’s mining-to-dining transition to boost the economy as a resources boom fades.
Hughes said Landbridge plans to make a “considerable financial investment” to expand the port.
“In addition to committing an initial A$35 million of new growth investment expenditure over the first five years, we anticipate in excess of A$200 million of capital expenditure over the next 25 years,” he said.
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