Port Authority: We're suing to stop sale to Dubai firm

Newsday.com ^ | 2/13/2006 | KAREN MATTHEWS

[ARCADIA]

NEW YORK -- The Port Authority said Thursday it will file suit to block a Dubai-based firm from taking over operations at a Port Newark container terminal, saying the federal government has not given them assurances about security issues.

[mnehring]

One argument is similar to yours; they claim that the P & O is one of the few companies in the world who are capable of such a big maritime operation, and that no U.S. companies exist which can move right in and do the job. This is their rationale for the immediate approval of the UAE's maritime company taking over the job at the 6 eastern ports.

The other argument is that this UAE maritime company will not be changing any operational procedures or switching management , security personnel, dock workers and the like. They claim everything will remain static, the only difference being that the new owners will now reap the profits.

Now, if the latter is true, then how can they claim that the UAE are one of the "few maritime companies in the world who can do the job", when all they're in fact doing is paying out 6.8 billion dollars for the contractual right to profit from this company?


Actually, I don't see how these contradict as you claim.. as in the case of most m&a's the value of the combined company is greater than the sum of its parts. Why would they pay 6.8 billion to keep 'business as usual'? Because 6.8 billion (US) (which, by the way, is for the entire P&O company, not just the container operations in the US) is a bargain considering it runs only about a 10% premium on P&Os share value at the time of the transaction.. In comparison, the merger that brought us Verizon gave MCI wireless shareholders over a 20% premium on their stock transaction. What DPI is doing here is taking a gamble on the future earnings of this company. There is no contradiction in the least.
The most management that will most likely shift hands will be the BOD. If one looks at the current operators of DPI, it isn't all UAE as is often misstated. Their current BOD actually only has only 2 UAE nationals.. the rest are Americans, Brits, Norwegians, and Indians:

http://www.dpiterminals.com/members.asp?MCatID=3&PageID=10&SubPageID=4&PSID=1

I would also argue that this wasn't a 'rush job' as implied.. the negotiations and regulations of the DPI purchase of P&O has been going on for months. The 30 days often cited is the review of the extension of the existing port contracts to the newly merged company. This comes on the heels of months of review by the UK into DPI & their operations, all info the State Department, Treasury, DHS, and other branches would have access to... the work was already done for them.. The US container facility aspect is a drop in the bucket in the entire transaction.

[notigar]

"Beats the hell out of me why they're against it. In fact, they'll be working for this new company as though it were the previous company. Their jobs are secured at these ports. But I do think they're doing it for grandstanding purposes, just like these goofy democrats whipping up frenzied hysteria."

That, or they have a funny problem with unloading a container with a bomb on it.

[Canedawg]

Why dont we just put them in charge of airport security, too? Let them operate the metal detectors. Let's make it one big Armageddon party!

[Junior_G]

Read it and weep. Then, if you have the balls, admit you are wrong.

Um...your post actually proves that the UAE royals were supporters of Bin Laden and the Taliban even while he was orchestrating terrorist acts. It was only after 9/11 that things got a bit too hot and the ties were severed.

[ohioWfan]

It's ignorance Mo. They think they're going to lose their jobs, but none of those things change. They're being told lies by their bosses.

[WestVirginiaRebel]

Usually you will find these folks on the immigration threads-or whining during election time, saying how Patty Buchanan is the greatest thing since sliced bread.

Fact of the matter is we do business with unpleasant people all over the world because it's in our national interests whether we like it or not. If we'd listened to these folks, we wouldn't have done any business with Japan in the Seventies and Eighties when everybody was so scared of them. The fact is that the more business we do with those Middle Eastern governments that are willing to work with us, the less likely an attack actually is.

[Mad_Tom_Rackham]

The truth of the matter is longshoremen. The Dubai company is not union friendly and they do what they do best WITHOUT unions.

I heard that the reason who none of the US port operators bid on the contract was because of the longshoremen's union contracts. I can understand this. But would the sale of the business to UAE/Dubai/DPO allow for the dismissal of the union contract? Or would DPO simply be assuming the headache?

[ARCADIA]

Reagan would have nuked Dubai after 9/11 Yeah that's why Reagan pulled out of Lebanon. You guys are clueless.

Are you equating an attack on a military operation in Lebonon with an attack against a major civilian target in our own home town? Are you really that lame?

[CWOJackson]

Immigration to Newark has nothing in common with port security.

[CWOJackson]

"Why dont we just put them in charge of airport security, too?"

Psssssssssst...they won't be in charge of security. Are you really that dense?

[BigSkyFreeper]

It's ignorance Mo. They think they're going to lose their jobs, but none of those things change. They're being told lies by their bosses.

Yep. Their bosses no doubt have probably been feeding the plebes in the union a bunch of BS, just so the dues keep coming in, and the bosses grease the hands of the politicians while lining their own pockets with union due cash.

A vicious cycle, and one reason why I despise unions.

[Howlin]

Chuckie's wife is Transportation Commissioner, but notice when the ferry crashed and eleven people were killed and hundreds injured there was NO mention of accountability at all coming from Mayor Bloomingidiot

I had forgotten that!

[ohioWfan]

The Japan parallel is apt, WestVirginia.

I remember horror stories about how the Japanese were going to take over and destroy this country.

I just didn't know WHO was making these things up, and fearmongering based on emotional nonsense. Now I do. They're right here on FR. ;)

[Alberta's Child]

I expect the other states will eventually join NY in the suit.

I hope the taxpayers of those states are happy to see their money flushed down the drain to pay legal expenses for silly court cases.

This suit by the Port Authority of NY and NJ will likely be thrown out of Federal court. I don't see what legal grounds they have to challenge the proposed merger, considering that: 1) the authority to review these mergers is vested in the Federal government, and 2) everything in the Federal process appears to have been done according to the letter of the law.

[dcgard]

I don't think you understood the analogy, read again.

[BigSkyFreeper]

The truth of the matter is longshoremen. The Dubai company is not union friendly and they do what they do best WITHOUT unions.

The Singapore company doesn't like to tangle with unions, which is why they're not the ones buying out P&O.

[Dane]

Are you equating an attack on a military operation in Lebonon with an attack against a major civilian target in our own home town? Are you really that lame

islamofascists attack us in Lebanon, Reagan runs away, while Bush takes out their main base of operation in Afghanistan.

It's called history, maybe something you learn before you spout your own revised form of it.

[OldFriend]

This is about the Port. President Bush did not initiate the deal. His cabinet approved the deal and I do not consider the deal to be a mistake.

[Canedawg]

Pssst...they will have access to the ports...they dont recognize Israel's right to exist. In the war of cultures, they will ultimately come down on the side of jihad. Who is being dense?