TAICANG CITY (China), March 23: Wharf (Holdings) Ltd. unit Modern Terminals is eyeing a majority stake in a $1 billion port expansion project near Shanghai to boost its position in China's fast-growing east coast region.

Modern Terminals, the second-largest port operator in Hong Kong after Hutchison Whampoa Ltd., already held a controlling stake in the first two phases of the Taicang container terminal, a major gateway to the affluent Yangtze River Delta area.

“We are looking for investors for the next two phases, and Modern Terminals has expressed a strong interest,” Taicang mayor Xie Ming told Reuters in Shanghai on Friday.

He did not name other potential partners for the expansion project, which still needs regulatory approval, but said stakes to be granted to overseas investors would most likely exceed 50 per cent.

Danny Wang, deputy general manager of a Modern Terminals local venture that operates Taicang terminal, confirmed the Hong Kong company was seeking a majority stake in phase III and phase IV and that talks with the government were going “smoothly”.

He added that the capacity of the Taicang container terminal will reach 2.5 million 20-foot equivalent units (TEU) when phase II is completed by the end of this year. It could double to five million TEU when the next two phases, with eight more berths, come onstream in the near future.

Modern Terminals, 68 per cent owned by Wharf (Holdings), has invested more than 10 billion yuan in Chinese ports so far, including two facilities in the vicinity of Shenzhen, near Hong Kong.

Other overseas players, such as Danish shipping and oil giant AP Moeller-Maersk, are also active in mainland China, banking on its booming foreign trade.

Moeller-Maersk and Hutchison Whampoa each hold 32 per cent in phase II of Shanghai's Yangshan port project. The second phase, with an estimated cost of $740 million to $870 million, was completed late last year.

—Reuters