DP World to invest $1.3bn to expand London port, making it UK's largest within five years

Global ports operator DP World will invest £1 billion ($1.3 billion) to expand its London Gateway container port, making it Britain's largest within five years and “significantly” increasing the volume of trade at the seaport. The expansion, which takes the company's total investment in London Gateway to more than £3 billion, will create 400 permanent jobs, in addition to the 1,200 people currently employed at the site, DP World said in a statement on Monday. The project will increase the port's capacity with two new shipping berths, taking the total to six, and add a second rail terminal to handle the expected increase in containerised trade. “DP World London Gateway will help make Britain’s trade flow in the future by connecting domestic exporters with global markets and delivering vital supply chain resilience for the whole economy,” Sultan bin Sulayem, DP World's group chairman and chief executive, said. By the end of the decade, the 2.5 kilometre quayside will be able to simultaneously receive six vessels, each more than 400 metres long, and will have Europe’s tallest quay cranes, the company said. The announcement comes after the company had “constructive and positive discussions” with the UK government that gave it the clarity it needs, DP World said in a separate statement on Sunday. The company was reported to have paused the £1 billion investment in its London Gateway container port after UK ministers criticised practices at its subsidiary P&O, Sky News reported on Friday, in a blow to the government on the eve of a flagship investment summit in London. The International Investment Summit started on Monday with participation from DP World. Sky News and Bloomberg also reported that Mr bin Sulayem had pulled out of his planned attendance at the summit. DP World on Sunday declined to comment on whether it was proceeding with the planned investments following these reports. In 2022, DP World's subsidiary P&O Ferries received criticism after it sacked 800 employees through a video message and replacing them with cheaper, largely foreign workers. It received a letter of strong rebuke from the British government. The company denied that it broke the law when it sacked the workers without warning in March. Mr bin Sulayem highlighted the British government’s failure to provide any financial support for the UK ferry company during the coronavirus pandemic after viewing it as a foreign organisation. “All the people who have basically lost their jobs have been given very good compensation,” he said at the time. “They all accepted the compensation they all signed, except for one. We made sure people were compensated well.” It was reported that the compensation package was worth £36.5 million, with about 40 employees receiving redundancies worth £100,000. On October 9, Deputy Prime Minister Angela Rayner and Transport Minister Louise Haigh announced new protections for seafarers, and ended what they said was a loophole used by P&O. Ms Rayner described it as “an outrageous example of manipulation by an employer” and said the government was on a mission “so no employer can abuse the system”, while Ms Haigh said the mass sackings were a “national scandal”. In an interview with ITV News , Ms Haigh called P&O a “rogue operator” and said she had been boycotting them for years. The Dubai ports operator reacquired P&O Ferries for £322 million in February 2019. DP World first acquired P&O , which included P&O Ferries, in 2006. However, it sold the ferry and shipping operator to its majority shareholder Dubai World, the emirate's holding company, before DP World went public in 2007. DP World has invested in the UK and is also working with British entities to boost its business globally. In June, DP World said it invested £34 million in its largest UK warehouse yet to meet evolving customer demand for logistics. The 598,000 square foot facility in the West Midlands city of Coventry is part of a £50 million investment that will help customers to stay competitive, DP World said that time. In September last year, DP World opened its 270,000 square feet facility at Bicester in Oxfordshire, the nation’s largest music and video distribution warehouse which handles approximately 70 per cent of physical music and 35 per cent of home entertainment products sold in the UK annually. In addition to its hubs at Southampton and London Gateway, DP World’s offer includes logistics, forwarding and European transport capabilities, all of which are being integrated into the company’s global network. Operating in 78 countries, DP World handles almost 10 per cent of world trade. In August, DP World and the UK's development finance arm British International Investment (BII) said they will extend their partnership with the development of the first phase of a new container port in the Democratic Republic of Congo (DRC) as the Dubai-based ports operator expands its presence in Africa. The BII has committed to invest up to $35 million into the DRC's Port of Banana, the country's first deepwater container port, making it a minority investor. The new port development is expected to create about 85,000 jobs, cut the cost of trade in DRC by 12 per cent and enable $1.12 billion in additional trade, according to the government agency. In the first half of this year, DP World's revenue grew by 3.3 per cent to $9.34 billion, while adjusted earnings before interest, taxes, depreciation and amortisation fell by 4.3 per cent to about $2.5 billion. “The year 2024 has been marked by a deteriorating geopolitical environment and disruptions to global supply chains due to the Red Sea crisis,” Mr bin Sulayem said in an earnings report in August. “Nevertheless, our strategic emphasis on high-margin cargo, comprehensive end-to-end supply chain solutions, and stringent cost management have been crucial in achieving this financial performance.”

DP World to invest $1.3bn to expand London port, making it UK's largest within five years

The expansion will create a further 400 permanent jobs, in addition to the 1,200 currently employed at the site