This afternoon, did any of you catch Wolf Blitzer’s interview of Dubai PW’s Chief Operating Officer (COO) Ted Bilkey – or, as the LA Times calls him, “U.S. shipping executive Edward H. ‘Ted’ Bilkey.”
First off, you have to picture this guy (and my description will have to do since there are no images of him that I can find, and scant — very scant — search results for the man himself).
He looks a lot like one of the better-off frequent golfers at the Shriners’ private golf club that my stepdad belonged to. Like a regular (snort) U.S. citizen. The kind of proper, white-haired, tanned man whose slow, deliberate, unaffected speech would have fit perfectly in the 1950s with an after-dinner brandy, a fine cigar puffed lightly, an appropriately attractive wife in an elegant but modest gown, and nothing but the most polite conversation in carefully chosen phrases.
He answered Wolf’s questions so slowly, I thought Wolf would have a coronary waiting to ask the next question. (And it’s damn good that Jack — or heaven forbid, Lou Dobbs — didn’t interview him.)
But, despite the slow speech and very simple answers, one thing was clear: This deal is going through. And he will “do whatever is necessary” to make that happen. He said exactly what Richard Crenna (as Edmund Walker) told William Hurt (Ned Racine) in “Body Heat“:
BILKEY: We will do anything that is necessary to try to get this… […]
BILKEY: The — well, I think we’re going do anything possible to be sure that this deal goes through.
The difference is that, in “Body Heat,” Crenna said it with menace and Bilkey said it like he was ordering a corsage for his debutant daughter. Wolf announced that Bilkey has already brought in Bob Dole to mollify the breast-beating senators. (John Warner has already been “mollified.”) Bilkey would not reveal who else he’s hired to press the flesh and make some deals “to be sure this deal goes through.” Below, the transcript:
Now a first live interview in the United States. Joining us here in THE SITUATION ROOM is Ted Bilkey. He’s the chief operating officer of Dubai Ports World.
Mr. Bilkey, thanks very much for joining us.
TED BILKEY, COO, DUBAI PORTS WORLD: Good to be here.
BLITZER: How big of a deal is this, your purchase, Dubai Ports World, of this British firm that operated these ports in the United States?
BILKEY: Well, it putts together a portfolio that’s going to encompass 50 terminals.
BLITZER: But it’s — but you spent how much, Dubai Ports World, to buy this British company, $6.5 billion?
BILKEY: $6.8 to be exact.
BLITZER: All right, $6.8 billion. And of that, how much money is at stake in operating these six ports in the United States?
BILKEY: Well, we put valuation on projects that we take on. And this is a huge project. And then we have a strategic view on things.
And if you put a map of 19, sometimes you call it 20, because we have new terminals coming on line, and their portfolio of 29 to 30 terminals, you have a strategic fit of 50 terminals that overlap. We had practically no overlap. The operations…
BLITZER: But the operations — excuse me for interrupting — in the United States is worth about $400 million to your company, is that right?
BILKEY: We could say it’s more valuable.
BLITZER: More valuable. All right. So it’s — a lot of money is at stake.
Here’s the basic criticism. Why…
BILKEY: But it’s a strategic value. That’s what’s important.
BLITZER: Right. The criticism, as you well know — and you’ve been hearing an earful over these past several days — is that, why should American ports be operated by a company owned by the United Arab Emirates?
BILKEY: Well, I think we should clarify a couple of things. First of all, we’re a commercial enterprise of the government of Dubai. The government of Dubai has nothing to do with us, basically.
BLITZER: But they own the company.
BILKEY: They own, yes.
(CROSSTALK)
BLITZER: They own the company.
BILKEY: That’s correct.
BLITZER: You report to the emir, in effect.
BILKEY: Not really. We report to a board. I happen to be a member of the board.
BLITZER: But the emir controls the board.
BILKEY: Yes, he’s the shareholder.
BLITZER: All right. So…
BILKEY: But, I mean, they’re not involved in our daily operations. When we want to make investments, when we want to have a new project, we decide it on commercial terms. And we base it on financially-sound operations.
You know, DP World, even before this acquisition, was a very large operation, highly respected. And we have wonderful relations with global customers.
And one of the reasons for this doing this good deal is that the shipping lines are coming together and merging. And you want to have a bigger asset base to be able to…
BLITZER: You hear the various criticisms. And I’ll go through them and give you a chance to respond.
That two of the hijackers were from the United Arab Emirates and that a lot of the funds that financed 9/11 went through the United Arab Emirates, and that some of nuclear equipment sold to North Korea, Iran and Libya went through the United Arab Emirates.
You’ve heard that criticism, right?
BILKEY: Well, I would respond to that by saying that the UAE — and I’m a businessman. I’m a terminal person. But on that subject, the UAE’s been a very good, very good friend of the UAE for a long time — of the U.S. This is a picture right here of a U.S. naval officer sitting in our control tower. They’re there 24/7.
BLITZER: In Dubai.
BILKEY: In Dubai, right now, coordinating with our harbor masters (ph) the coming and going of vessels for the U.S. Navy.
We have performed for them in the first Gulf War. We were the base for supplying the Navy at sea. We have a mini base there. We have — we were the first and I believe, still, one of the earliest port operators to join the Customs security initiative.
BLITZER: The other criticism is — Dubai Ports World operates all over the world, is that right?
BILKEY: Yes.
BLITZER: The criticism leveled by several congressmen is that the United Arab Emirates is a country that refuses to deal with Israel. Does Dubai Ports World deal with Israel?
BILKEY: Well, it’s rather interesting. One of our very sound customers is Zim line.
BLITZER: So you do deal with Israel. Zim is the Israeli shipping line.
BILKEY: Yes. It’s the largest shipping company. And the president of that company, because we have good relations with all of our clients — and it’s interesting to me that he is very close to our company and supports us.
We handle their operations in a number of ports throughout the world. And — because it’s good commercial business for us. They wouldn’t come to us unless we did a good job.
BLITZER: Does the emir know this?
BILKEY: Absolutely.
BLITZER: He doesn’t care?
BILKEY: As I told you, we — we operate — as long as we’re doing good business, correct business — I think one of things that has happened here, there’s a complete misconception of what ports do and what terminals do. P&O, which has this wonderful history…
BLITZER: That’s the British firm that you’re buying.
BILKEY: Correct. It has this wonderful 165-year history which we give great respect to.
We tend to — intend to keep this portfolio together because it matches ours strategically. That they have to comply with all the present security operation, security (INAUDIBLE) across the board up and down the coast.
Now, people start to talk about controlling ports. The ports are controlled not by — we have a terminal. We have a concession for a terminal. And there’s a complete misconception about security.
Security comes under the purveyance of the Coast Guard, the Homeland Security, Customs, the local police forces. And we implement their instructions.
We follow those to the letter. And as I said today, that we have U.S. Customs people on the ground in Dubai ensuring that every box that comes to the U.S. they are aware of. It is not loaded unless it is cleared by U.S. Customs.
It’s like extending the borders of the U.S. And we have agreed to it. And we signed that agreement.
BLITZER: And I want to pick up that thought because we have a lot more to talk about. But we want to take a quick commercial break.
More of our conversation with Ted Bilkey, the chief operating officer of Dubai Ports World. This is his first live interview here in the United States. He’s based in Dubai, he’s a U.S. citizen. We’re going to have more questions for Mr. Bilkey right after this.
(COMMERCIAL BREAK)
BLITZER: Welcome back.
We’re continuing our exclusive conversation with Ted Bilkey. He’s the chief operating officer of Dubai Ports World.
You’re about to take over control, operating control of six ports in the United States, including New York, New Jersey. We’ll show our viewers a map — Miami, Baltimore, New Orleans. These are the biggest, some of the biggest ports, if not the biggest ports in the United States. Certainly on the East Coast.
Scott McClellan, the White House press secretary, said you’ve made some additional commitments to reassure the United States of the security provisions.
Listen to what he said earlier today. Listen to this.
(BEGIN VIDEO CLIP)
MCCLELLAN: One thing that is key is that this company agreed to additional security measures that they would take beyond what some others do in transactions like this.
(END VIDEO CLIP)
BLITZER: What does he mean? What additional security measures have you agreed to take to reassure that the safety, the security of these American ports would remain intact? BILKEY: Well, that’s in a letter of undertaking that, you know, frankly hasn’t been released yet. But we took these, you know, readily, and they are well-implemented and within the scope of the type of things that we like to bring more than the code requires. And we made these undertakings, and we have no problem in implementing them.
I think the most important thing to know is that, when we actually formally take control of this company, which will come after a process that goes through the British court system on March 2, nothing is going to change. The people here are not going to change. The structure isn’t going to change. And the people here who have been running a very good operation…
BLITZER: You’re not going to bring your own people in? You’re going to keep all those P&O people on the job?
BILKEY: Yes. Well, most of them, you know, are Americans. And the CEO of the Americas, Michael Seymour (ph), is a very seasoned shipping and terminal person. And he has as his right hand Steven Edwards (ph).
BLITZER: So they’re all going to stay.
Let me read you to you some criticism…
BILKEY: Absolutely. And, you know, if it’s not — if it’s not broke, why fix it?
BLITZER: Here’s a criticism from Warren LeBack. He was the maritime administration head under the first President Bush.
He’s quoted as saying, “The security in the ports is very lax, as we all know. In an ordinary container, you could put a dirty bomb with a GPS or a cell phone and set it off in the middle of a city. If the United Arab Emirates decides they are clandestinely supporting terrorists, they could put pressure on personnel to look the other way on the containers.”
What do you say about that?
BILKEY: Nonsense.
BLITZER: Why is that nonsense?
BILKEY: Well, first of all, as I just explained to you, that we don’t control all of the boxes that come here. They’re loaded on ships and ports from all over the world. And, you know, in the realm of today, as we well know, anything is possible.
But as far as something from Dubai happening, U.S. Customs is there. They have the right. We have given them the sovereign right to inspect any container they wish to before it’s loaded on a vessel.
And the CSI initiative now operates in 35 ports around the world. In our portfolio, nine of our ports are CSI-oriented. And it’s — actually, the U.S. government is trying to do this in other areas.
We are in the forefront of trying to have it happen in the Dominican Republic. We are working with the government of the Dominican Republic. We operate a brand-new modern, highly-secure facility in Casado (ph), near the Dominican capital, Santo Domingo, and another CSI operation.
Interesting thing, Wolf, you might be interested in: Security now, in our business, is a marketing tool. The shipping companies want to know that you run a secure operation. And all the other countries that we did, including the U.S., all said: “We know your type of company. We know what you do. We know the way you operate.”
BLITZER: But…
BILKEY: “We welcome you.”
BLITZER: … you know there’s a huge firestorm now, a political uproar.
I assume, given the value, how important this is to Dubai Ports World, this — this deal — we have already reported that Bob Dole, the former senator, is now going to be helping you. He has been retained.
Who else have you retained here in Washington to try to sell this deal to very skeptical lawmakers on Capitol Hill?
BILKEY: The — well, I think we’re going do anything possible to be sure that this deal goes through.
We’re very much committed to that. We think it’s great strategic fit. And we think it will be good for our customers. We think it will be good for our employees. And we think it will be good for the people involved in the ports.
We’re strong investors. When people come to us and say, you need to invest more, because we think we can bring more business to the port, we’re listeners. We have done this all over the world. We’re very active that way.
BLITZER: So, you’re going to aggressive lobby here on Capitol Hill to get this approved?
BILKEY: We will do anything that is necessary to try to get this…
BLITZER: And do you want to mention any other names of people you have retained?
BILKEY: No, I don’t think I would like to do that.
But I think the important thing is, this misconception is really something that is so major, that — as far as the security angle of it, that — the security is running today. If another company had brought this, would this have been a problem? No. Why it is a problem? It shouldn’t be a problem. And I think we believe that we have message as a company, and, as a — and the clients that we have will speak for us. I think our track record is pretty good.
I mean…
BLITZER: All right.
Ted Bilkey, you have got a tough sell here in Washington. But I see you’re going to try to make that sell. Appreciate your coming into THE SITUATION ROOM.
BILKEY: Well, always glad to come back to Washington. My mother grew up here — father was a senator.
BLITZER: Your father was a senator?
BILKEY: Yes. And I have pictures of her sitting on the White House steps with President Harding.
BLITZER: Excellent.
BILKEY: And she’s still alive.
BLITZER: Good for her.
(LAUGHTER)
BLITZER: Excellent.
(LAUGHTER)
BLITZER: Good work.
Mr. Bilkey, thanks very much for coming in. We will hope you — we hope you will be back.
BILKEY: Glad to. Thanks.
BLITZER: Tell — Ted Bilkey is the chief operating officer of Dubai Ports World.
