Forth Ports agrees to meet with its suitors

Edinburgh-based Forth Ports has agreed to meet with its suitors, "in their capacity as shareholders" following news earlier this month of a 612m takeover approach by a group of major shareholders.

It also reported full-year figures showing a return to the black in 2009, with pre-tax profits of 36.3m against losses of 30.7m in 2008.

On an underlying basis, profits dropped from 36.3m to 33.2m.

Forth Ports owns seven UK ports, including Tilbury in London, Scotland's largest container port at Grangemouth and Leith in Edinburgh.

The group has seen shares leap ahead after revealing takeover interest two weeks ago.

It rejected an improved 1340p a share proposal from a consortium which currently owns 27.4 per cent of Forth's shares, following an initial approach in January.

The group said: "The board considered both of these proposals carefully and, having discussed them with its financial advisers, Commerzbank London Branch, and its corporate broking advisers, Investec Bank, the board is of the unanimous view that these proposals fall far short of the value of Forth Ports.

"We have agreed to meet the consortium in their capacity as shareholders."

The consortium is led by Arcus European Infrastructure Fund, an investment firm formed by the management buyout of part of Babcock & Brown's European infrastructure business in July last year. Arcus holds 23.5 per cent of Forth.

Other members are Peel Ports – a 3.5 per cent shareholder in Forth with interests including the Manchester Ship Canal and Mersey Docks – as well as RREEF, which is the infrastructure fund of Deutsche Bank.

Forth said the business was "in a resilient position" and added that recent trading in January and February had been well ahead of the previous year.

It has already hinted that the Arcus and Peel consortium was attempting to snap up the company on the cheap and stressed again yesterday that its portfolio of ports, property and renewable energy projects "was well placed to withstand economic uncertainty and deliver growth in shareholder value".

Forth's return to profit last year came partly after a positive revaluation of its land bank, which had been slashed from 282m to 60m in 2008.

The group said its property assets had improved to 74m at the end of 2009.

But its ports business saw underlying operating profits fall 8 per cent in 2009 to 40.5m – largely accounted for by a plunge in profits at its container operations, according to the group. Forth said the container division would benefit from a rise in volumes and storage of containers as the economy recovers.