The economics behind co-operation and competition in sea-port container handling

Container-handling companies have engaged in various forms of expansion, of which many are co-operative. This thesis tries to assess the benefits from mergers and acquisitions in particular. It is shown to what extent economies of scale occur, how these depend on container-handling conditions, and how mergers and acquisitions in particular may generate economies of scale in container-handling. The thesis starts with analysis of the container-handling product, which is composed of many products, which can be processed sequentially as well as simutaneously, making container-handling a multi-product business.; The existence of terminal economies of scale is demonstrated qualitatively as well as quantitatively. Economies from terminal scale are observed for all the different settings considered, they are in some cases substantial and they are mainly due to labour and maintenance. 89 influencing factors, ranked as policy, scope, chain terminal-specific of container handling supply and demand conditions are identified. The main results of the quantitative testing are that economies are increasing in terminal capacity and crane sized, decreasing in labour flexibility, and in line under new versus old equipment scenarios.; Specific to mergers and acquisitions, effects on container handling conditions, and economies at container terminals may be threefold: there may be economic, financial or market effects. Acquisitions as well as start-ups focus on long-term positioning rather than cost-economizing, starting nothing however about the size of the respective effects.; Although the focus in the thesis is on merger and acquisition decisions, it is shown that other company decisions like the type of competition, network building, differentiation, diversification and integration impact on specific merger and acquisition effects. It is for instance noted that more limited companies are started up abroad than domestically. It is also observed that, except for the major operators PSA and Eurogate, all operators have started up more limited companies in the cargo-handling business than in non-cargo-handling businesses. The logistics sector is most often a target sector.; Different strategies are however applied by the major container-handling operators. APM Terminals, Eurogate and DPA have started up more companies non-co-operatively than co-operatively. HPH and PSA have quite often teamed up with shipping companies in their terminal ventures. A final conclusion of the thesis, of relevance to eventual use of the results obtained in model and/or game setting, relates to the fact that oligopolies prevail.; The entire methodology behind this thesis can also be applied to other cargo-handling businesses. Outputs from this thesis ought to be used as inputs to decision-making models in for instance shipping, port-related antitrust, etc....