The CEO of Africa Global Logistics (AGL), formerly Bolloré Transport & Logistics (BTL), talks of the changes in the company over the last few months, especially as concerns the port and maritime activities. At 57, the former deputy managing director of BTL is one of the 23,000 employees retained by the Swiss-Italian shipowner. He was still at the helm of a company renamed as Africa Global Logistics (AGL) at the end of March 2023.
For the first time, Philippe Labonne has talked of the consequences of this operation for the company and also the maritime and logistics services to Africa, considering that AGL, as part of the MSC group, is one of the key players.
Jeune Afrique: Just a few months ago, you were in charge of Bolloré Transport & Logistics (BTL), that was to disappear following the buyout by MSC of the African business and by CMA CGM for the rest of the business.
How do you feel about this sudden and rapid change?
It’s ion keeping with the global changes in the industry. We are at a turning point in international trade. After the Covid-19 pandemic or the war in Ukraine, the world’s major economic players are now anticipating crises and redirecting their flows to the Middle East, South-East Asia and Africa. Therefore the continent will benefit from a transfer of investments that were previously destined for China, at a time when the development of new technologies will help it to become a credible player in the production of goods.
And another factor that cannot be ignored is energy transition. Again, the continent has a lot of assets that could allow it to leap-frog steps and switch directly to clean energy production at very competitive prices. This means that right around the world logistics chains are being redefined.
Do you feel that you are in a better position today to meet this new situation for the continent?
Belonging to a group that operates in its specific fields of business (maritime transport and logistics), and to the development of which it devotes its resources, is more promising for us than being part of a multi-sector conglomerate as was previously the case.
What are AGL’s ambitions in Africa?
As Diego Aponte [MSC’s CEO] stated, we are continuing on from the work accomplished by the Bolloré group, helping create sustainable growth in Africa. Our priority is to develop our portfolio of port concessions while maintaining the productivity of ojur plants on the continent.
AGL wants to act as a lever to help African economies with the global transitions to which the continent is committed, in terms of demographic growth, improving living standards, energy transition, the development of intra-African trade or industrialisation. To achieve this, we intend continuing to invest in all segments of the multi-modal chain, including rail, where MSC has developed recognised expertise through its subsidiary Medway.
Were you surprised that the Bolloré group abandoned its transport and Logistics activities, which had been its its flagship for decades?
No one expected it to happen in the space of six months. Vincent Bolloré was incredibly agile. He is a genius in its own right and his own strategy, which few are able to predict. His decision may be explained by the fact that his group wasn’t only present in the transport business, where the stakes have changed considerably over the last few years. It was therefore perhaps wiser to sell it to someone who was more determined and with greater investment capacities in this line of business.
Does that mean that only specialised players can operate in this field?
In every business and every sector, we are witnessing the emergence of global giants, as well as the consolidation of volumes and trade. It’s therefore increasingly difficult for an outsider to succeed.
Can you confirm that AGL will remain BTLs correspondent in Africa?
We will continue to work together, but will also open up to other networks that are looking to develop their businesses in Africa for their customers. We remain a multi-user company, capable of loading goods onto the ships of several companies and working with different logistics partners, to providing our customers with the best possible service.
MSC’s buy-out was approved in under a year. It seems that the hardest and longest part was convincing the authorities in the countries concerned
We had to explain the project to them, which is a normal thing as we are part of a public-private sector partnership. The authorities entrust a private operator with part of their national heritage; therefore if there is a change, they expect the new shareholder to present themselves, explain their project and confirm that the commitments made will be respected. This is what we did with the African public authorities, our customers and our personnel.
How was this change received in the African capitals?
Everyone understood that MSC was the best candidate to take over AGL’s business. The network is now in the hands of a shipowner that has clearly chosen to focus on its core business and to commit itself to the development of Africa.
MSC expects that we make the port infrastructures more efficient and obtain better results for all of our customers, i.e. shipowners.
Our priority is to improve the productivity of our terminals. To achieve this, our strategy is to bring forward our investments to guarantee the fluidity of our operations, hence our expansion projects in Pointe-Noire, Conakry… We are always looking to stay one step ahead, which will benefit all the players in the sector.
Does AGL have greater investment capacities as a result of this takeover?
Yes they are larger than they were previously. We are no longer part of a group where we have to share financial resources with other business activities. We are now at the core of the reactor.
Who decides when to invest or withdraw, AGL or MSC?
We have delegated authority (DOA), and the strategy decided by the Board of Directors is implemented by AGL. Above a certain level of investment and withdrawal, the files are presented to the Board of Directors for approval.
Since the takeover, everyone is talking about how much autonomy AGL has within MSC. Is that true?
Yes, we have a great deal of autonomy, within a well-defined governance framework. The Board of Directors is made up of four members, Ela Aponte [the wife of Diego, CEO of MSC], Nicolas Sartini, Vice-President of Development at MSC and myself, chaired by Hugues Favard, Director of investments at MSC. We meet regularly to validate the budgets. It’s a classic way of working, but with a great deal of freedom to operate, and we always seek to create value for the MSC Group.
Are you developing synergies with Terminal Investment Limited (TIL), MSC’s port subsidiary?
TIL is much bigger than us. We are a regional player, they are global. Of course, we have started talking to compare practises and inspire one another. But we are not the African subsidiary of TIL. We have different shareholders.
Who within the MSC group will be managing the Douala terminal, lost by BTL and taken by TIL?
You need to ask the Cameroon authorities that question. We are ready to talk with them about the framework needed so that MSC can help fully to develop the port and the country.
How was the five-year dispute between BTL and the Lomé Port Authority resolved?
The Togo authorities preferred taking advantage of the transaction with MSC to turn the page and open a new era in our partnership. There is no longer a dispute, all of the complaints have been withdrawn. And AGL has committed to make large investments to accelerate the development of the port.
The Togolese government used this opportunity to increase its shareholding in your terminal. A few weeks later, Senegal followed suit for the port installations managed by DP World, in Dakar. Is there a new balance between private and public partners?
There are several concession schemes, and it’s up to the States to decide how they want to manage their assets. Today, concession contracts provide strong protection of the interests of the States as they retain ownership of the assets.
We need to distinguish between the State as regulator, which sets the rules, and the State as shareholder, which must be treated on an equal footing with the others. While it is completely understandable that public powers wish to be involved in the running of a terminal, they must do so in conditions that are the same as for the other shareholders, by taking on their share of investment. Certain countries are interested, others prefer allocating their resources to other projects. There is no single virtuous path here.
Do you think that it is a good thing for the business that shipowners are coming onto the terminals?
Yes, because they are players who bring flows of goods to the ports. When an operator develops a port platform and has a shipowner among its shareholders, the operator benefits from those flows. Shipping companies are our customers and our suppliers, for the port activity but also for the logistics, where their support provides with more solutions and capacities. It’s better for us to have shipowners in the port, who know their business and have an industrial approach based on performance, than pure financiers who are only looking at short-term interests.
Vincent Bolloré is also a financier…
No, he’s an industrialist who has a proprietary vision of his group but who also knows the business very well. If he was just a financier, he would certainly not have invested in African ports twenty years ago.
Are the fears about the fair treatment of shipping companies at terminals well-founded?
In the past, we already had a shipowner as a shareholder. Today we work on certain terminals with partners that are also shipowners, and we have always remained neutral. Our structures need all of the flows from the different shipowners so that they can develop.
There are also commitments to equal treatment that we must respect as part of our delegation contract. Lastly, shipowners owners are very vigilant about the way they are treated in the face of competition. Our interest is to see the ports develop. MSC is indeed looking to increase its business but also to contribute to the prosperity of Africa, to legitimately benefit from it.
Where do you intend to invest on the continent?
There are around 240 industrial logistics zone projects in Africa. We are prepared to invest in a certain number of them, either as developers or as simple logistics operators. The decisions will be taken depending on the environment of each project.
There are also a few major port projects that we are following closely. The most important thing for us is to help consolidate and improve the continent’s port and logistics ecosystem by developing platforms in and around ports, and by improving connections between port and logistics platforms, cities and hinterlands..
The real challenge today is to help the industrial and agricultural development of the continent so that it can achieve its full potential. We wish to set up integrated logistics, storing close to the production areas rather than in the ports, so that the goods can be loaded into containers as early as possible. Our long-term logic is to help the transformation of the continent whilst keeping an eye on all sectors of activity that contribute to improving the standard of living of Africans.
So you agree with Zlecaf’s continental approach?
We want to make it happen but it is up to the States to implement it. A lot of political efforts are still required for such a project to succeed.
Does this incite you to turn more towards the east and south of the continent, where AGL is not as present as it is in western and central Africa?
We ave always looked to these regions. We have logistics operations in Ethiopia, Tanzania and Kenya. We are the leaders in Mozambique, and were the first to operate in South Sudan. We are very interested in the port activity in these regions, but there needs to be a concession for the terminals. In Kenya or South Africa, the infrastructures are still 100% public. We responded to the tender in Mombasa,but it was suspended.
What are the main upcoming port projects?
Mombasa, as it happens, as well as Dar-es-Salaam and especially the major privatisation projects in South Africa. As for the catching up that is needed on the East coast, the private sector can play a major role. There are also major investments required on the Atlantic coast. Nigeria is under-equipped; the growth rate of the Ivory Coast means that it will increasingly rely on San Pedro…
How would you sum up your first few months at the head of AGL ?
The handover went as smoothly as could be hoped for, all of the AGL teams feel that they have been fully integrated into the MSC family. We belong to a powerful player in the sector, with a very business-focused policy and an industrial strategy geared towards Africa. We are leaving a consolidation phase and entering an era of strategic redeployment, where the emphasis is on logistics and the connectivity of the ports.
Our key focus is to ensure we are present in the future main pan-African corridors. We are also closely following certain port projects outside of Africa, such as in Haiti for example. We are also monitoring the Indonesian market, starting with East Timor where we’ve been since 2011, which offers some very interesting prospects.
Can you already feel the DNA that the MSC group mentions so often?
Without doubt this company’s DNA is that of a shipowner, with a real passion for maritime transport. Gianluigi Aponte has been a great captain of industry, who took less than fifty years to create the world leader in the sector, purely through organic growth.. The Aponte family’s strength is that it is both humble and ambitious. These are values shared with MSC, and are a source of inspiration for the AGL teams.