The board of the Virginia Port Authority has set a date of March 26 as the deadline for determining the future of VPA’s terminals on Hampton Roads.
At its board meeting Tuesday the directors of the state-owned port agency set that date to decide on one of two options: They will either decide to continue negotiations with two private terminal operators about leasing the state-operated terminals to them or they will decide to reorganize VPA with a view to bringing Virginia International Terminals, the current operator, firmly under VPA’s authority.
“On March 26th the board will either vote to reorganize or vote to go with a private company,” said VPA spokesman Joe Harris.
The two private terminal operators that are bidding on the VPA terminals are APM Terminals, which has made a bid it estimates at between $3 billion and $4 billion over the 20-year term of the lease, and Virginia Port Partners, a joint venture between J. P. Morgan IIF Acquisitions and Maher Terminals, which would operate the port, along with an affiliate partner, Noatum, a company that operates other ports throughout the world.
Virginia Port Partners entered the bidding in December when Deutsche Bank’s RREEF infrastructure fund dropped out of the bidding. The VPP proposal includes an up-front $400 million concession fee to Virginia, which would be paid in April.
VPP said at that time that it could buy the terminal, or the port authority could keep its lease with APM and let VIT run the terminal, with JPMorgan paying the rent.
“The status quo will not be an option on the 26th,” VPA spokesman Joe Harris said. “So we’ll either go with a private bidder or the board will give the green light to continue reorganization plans for VPA and VIT.” He said the reorganization would bring VIT very clearly under VPA’s control. “They will no longer be parallel companies.”
He said the board would not proceed with the VPA reorganization if it decides to lease the terminals to a private bidder.