Posted on 02/15/2007 3:36:45 AM PST by Calpernia
WASHINGTON (AP) -- Dubai Ports World, the company whose planned takeover of major port operations in New York and other U.S. cities ignited a political firestorm last year, may be headed for a new storm in its plan to sell off those operations to a U.S.-based company.
The Port Authority of New York and New Jersey is seeking tens of millions of dollars from the prospective new owner, AIG Global Investment Group, for improvements the port agency has made to the Port Newark Container Terminal in Newark, N.J., which AIG would operate.
Port Authority spokesman Stephen Sigmund said Wednesday he could not put a precise figure on how much the agency should receive in cash payments or future work at the facility, but he said the agency has spent $30 million in infrastructure developments since 2000.
The agency is seeking to strike a deal with AIG for the costs incurred expanding a 15-acre parcel of the Newark operations and wants a commitment by AIG to further work.
"We're not looking to hold up anything,'' said Sigmund, who said he did not know of any other U.S. ports seeking similar compensation from AIG.
Dubai Ports World, based in the United Arab Emirates, is the world's largest marine terminal operator with 51 terminals in 24 countries. It announced in December that it had struck a deal to sell AIG the U.S. operations, which include six major U.S. seaports in New York/New Jersey, Philadelphia, Baltimore, Miami, Tampa, Fla., and New Orleans.
The deal also involves stevedoring operations in 16 locations along the eastern seaboard and Gulf Coast and a passenger terminal in New York.
The U.S. holdings were valued last year at roughly $700 million, but the companies did not disclose the sale price.
Sigmund said Dubai Ports World has "made a pretty substantial profit here, and we want AIG to make a commitment to reinvest money in the capital projects so that we're sure they're going to operate the terminal responsibly.''
AIG spokesman Chris Winans would not discuss the company's talks with the Port Authority, but he said "we remain excited about the possibility of acquiring this business.''
Asked if the agency's request for money had delayed the sale, Winans declined to comment.
AIG Global Investment Group is an asset management firm whose parent company is the New York-based insurance firm America International Group Inc.
The Port Authority has the right to consent to a new owner under the terms of its 30-year lease to operate the Newark facility.
The negotiations between the port and the new operators are just the latest twist in a complicated global saga that began early last year, when DP World won permission from the U.S. government to buy a company with extensive port operations in the United States.
That set off blistering criticism from U.S. politicians of both major parties, who said the deal could threaten homeland security. They cited the UAE's support of Afghanistan's Taliban government before the 2001 terror attacks and questioned whether the country or the company had done enough to keep out terrorist money and material.
Even as DP World completed the acquisition on paper, political pressure forced the company to take a hands-off approach to ownership of the U.S. assets.
One of the fiercest critics of the original deal, Sen. Charles Schumer, D-N.Y., was uncharacteristically quiet on the subject Wednesday, saying only that he was following the matter closely.
You can bet that schumer has his hand in there somewhere.
The Port Authority of New York and New Jersey has done -- and is continuing to do -- a number of key off-site improvements in the vicinity of the Port Newark Container Terminal (the name of the actual terminal whose lease is being sold to the AIG group) that have really enhanced the value of the terminal to the current lease holder. One such improvement is the "near-dock" rail terminal across Corbin Street from the PNCT facility.
The Port Authority is basically saying to Dubai Ports World: Since the improvements we paid for have made your terminal so much more valuable for a prospective buyer, why don't you cough up some cash to repay us for all the work we've done?
We are doomed.
Or, maybe not. The Port of New York is worth a good half trillion bucks.
So, what is it Dubai owns?
Obviously Dubai does not own the Port of New York, or any major seaport (other than its own in Dubai). What they own are GANTRY CRANES used to place international shipping containers on ships or on docks.
Someday the reporters may get the story right, although I'm not holding out any hope for the politicians.
..and since we've been taxed to "rebuild" or "recondition" the tracks at the docks I'm sure we all will receive a little tax reduction...(grab a seat). Don't you find it just a bit out of whack that 6 or 7 other major cities with docks have already signed on with this deal without holding out for more $$$$$$ and they seem to have done well making sure their stuff has been properly maintained?
Doogle
Schumer ought to keep quiet because he and others made complete and utter fools of themselves on this issue.
The security risk was completely bogus. If the United Arab Emirates is a security risk then why didn't Chuckie and the other panic merchants complain about the two jumbo jets Emirates Airlines flies out of JFK every day?
psssst AC..here's a link to let you know where NJ stands as far as government waste and corruption...
http://www.apatheticvoter.com/FederalStateWaste.htm
Doogle
The Port Authority of NY and NJ does not get any taxpayer funds. They are a quasi-public agency that gets all of their revenue from the facilities they operate (airports, ports, bridges & tunnels, etc.).
whoops...you are absolutely correct, I should have stated fare increases. (bridge crossings and alike)
Note that DP World has run these ports for over a year now, and we've not had a single terrorist incident because of it. Nobody's said one word on the house floor or senate floor about how dangerous our world was with DP world in charge of these operations.
Republicans got played by Schumer, and we looked liked fools. Aught to be a lesson learned there, but unlikely we've learned it yet.
My personal opinion -- we'd be better off with DP world running the ports than AIG. AIG is a corrupt organization with ties to the democrats (and vice-versa), which is more likely to operate for the benefit of its political partners and the unions than in the interest of U.S. security.
DP World was much more likely to take security seriously, as we would have been watching it closely.
Oh well, nothing like throwing a fit, making Schumer look good, and hurting our security and economy.
Their business is leasing and operating gantry cranes that load and unload ships.
So frikkin stupid. Dubai was perfectly capable of running those ports as safe as anyone else.
The PA of NY is one of the most dysfunctional bloated organizations in the world. Look at the disaster Ground Zeor has become.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.