Forth Ports linked with bid for Dover as it bounces back sharply

FORTH Ports came out with all guns blazing yesterday, transforming from a takeover target to a firm that has rival ports businesses in its sights.

The company unveiled a "confident" set of half-year results after fighting off a move last May by a consortium of shareholders to take what is the UK's last listed ports business private.

Charles Hammond, chief executive, said the board felt "optimistic" about the firm's prospects and that it plans to "grow and acquire other ports businesses".

Some analysts have linked Forth Ports with a possible swoop on the Port of Dover - a government-owned trust port. Government advisers have added the busy port on to a list of public assets that could be put up for sale to battle record public debt levels.

Buying Dover would be a return to form for Hammond, who led the group's last big port acquisition - Tilbury - some 16 years ago. In 2007, Forth Ports also acquired the Nordic Group recycling business in Kent.

The Scots ports and property group also confirmed it has submitted master plans for new retail and leisure development at the Harbour on Leith Docks. The success of the next phase of development relies on the Scottish Government giving the green light on a Tax Incremental Finance (TIF) scheme. Through TIF, the City of Edinburgh Council plans to borrow 84 million to fund infrastructure work around the area - such as a public promenade and new link road - using future income from rates rises to fund the loan. Hammond said he expects the Government's Scottish Futures Trust to give the project the go-ahead by the end of this year.

Forth reported a 29 per cent increase in profits, triggering a 5 per cent increase in the interim divided to 10p a share.

The Edinburgh-based firm, which owns seven UK ports, posted pre-tax profits of 16m in the first half of the year, with group revenues up 3 per cent to 89.6m.

Hammond said Tilbury, which is London's major gateway port, should get a boost early next year when the London Olympics organising team starts using the site. According to Forth's boss, the games organisers were taking up to 10 per cent of warehousing on the site.

Container handling at Grangemouth, Scotland's largest container port, on the Firth of Forth, was down 10 per cent. Hammond said the downturn was linked to Scotland's slower recovery from recession than the rest of the UK.

The ports business made slightly higher profits of 16.9m, while its recycling and property divisions made losses of 100,000 and 800,000 respectively. However, property revenues were up substantially to 4.3m in the first half, from 800,000 in the same period last year, after the firm bought out its joint venture partner, Lloyds Banking Group, in the Ocean Terminal shopping centre on Edinburgh's waterfront.

Forth said the three-level mall had maintained its previous valuation of 85m.