KARACHI: American agricultural company Cargill has made its first investment in Pakistan out of a promised $200 million by acquiring 25 percent stakes in Fauji Akbar Portia Marine Terminal (FAP), Pakistani officials said this week.
The FAP facility at Karachi’s Port Bin Qasim is a fully automated grain and fertilizer terminal capable of handling four million metric tons of dry cargo per annum.
Last week, Cargill and the Pakistan army-run Fauji Foundation signed a long term strategic partnership, under which the American firm has acquired a minority equity stake in FAP, a bulk terminal, and will handle grains, cereals, rice, oilseeds and fertilizers at Karachi city’s Port Qasim.
“Cargill has acquired 25% shares of the FAP to expand the operations of the terminal to handle more cargo,” Mahmood Moulvi, an adviser to the ministry of maritime affairs, told Arab News on Tuesday.
FAP, which started operations in 2010, is a joint venture between Fauji Foundation, Akbar Group of Companies and National Bank of Pakistan (NBP). Cargill is one of the largest importers of soybean, palm oil and palm oil products into Pakistan.
In a meeting with Prime Minister Imran Khan in mid-January 2019, an executive team of Cargill had announced a $200 million investment in Pakistan over the next five years. FAP’s equity purchase is part of the promised investment, according to an official at Cargill Pakistan who declined to be named as he was not authorized to speak to the media on the matter.
“It is the first investment which the company had promised last year,” the official said. “It will augment the company’s investment strategy of expansion including increasing handling and storage capacity. More investment will be made in the future as the company is exploring options in commodity trading, feed milling, dairy and poultry processing, oilseed crushing.”
Cargill, headquartered in Minneapolis, United States, has a presence in over 70 countries. Its global expertise, other than in commodity trade, lies in areas including farming, feed milling, meat processing, oilseed crushing. Cargill owns and operates, either wholly or partly, more than 30 ports around the world, of which four are in Asia.
“To conclude this transaction at this point in time is a clear signal and validation of the Pakistan opportunity seen by the world’s leading player in agriculture commodities,” Waqar Malik, chairman of Fauji Foundation said in a statement, adding ”With its global port experience, Cargill will help drive greater operational efficiencies for the port to reach its potential of handling agri-cargo safely and efficiently.”