By Alexandra Alper and Dave Graham

MEXICO CITY, Jan 20 (Reuters) – Port operator APM Terminals, a part of Denmark’s A.P. Moller-Maersk, has dropped Mexico’s ICA development agency from a $300 million port undertaking after it ran out of money and couldn’t proceed work, two folks aware of the matter mentioned.

ICA, which has defaulted on debt funds, was dismissed on the finish of December from the undertaking to construct a brand new container terminal within the main Mexican Pacific port of Lazaro Cardenas, the folks mentioned.

As early as 2013, ICA’s liquidity issues precipitated delays, forcing APM Terminals to barter an extension to the undertaking deadline with the federal government, one of many folks mentioned. The undertaking is almost two-thirds full, the particular person added.

Representatives for ICA and APM Terminals didn’t instantly reply to requests for remark.

The cancellation of the Lazaro Cardenas contract raises questions on ICA’s fast prospects after it mentioned it will default on two separate curiosity funds totalling about $37 million with a purpose to privilege operations.

The firm, hit by a sinking peso that makes its substantial greenback debt costlier, has mentioned it will current a preliminary restructuring plan in February.

The undertaking to design, construct, and function a brand new container terminal in Lazaro Cardenas for 30 years was awarded in 2012 to a consortium led by APM Terminals, ICA mentioned on the time.

ICA, APM’s sole accomplice with a 5 p.c stake, was given the preliminary civil development section, which included dredging a channel and constructing a wharf, container yard, rail services, places of work and a water remedy plant.

The Mexican firm was employed for the primary section of what was laid out as a three-stage $900 million growth of the cargo port. Successful completion of the primary stage might have secured ICA extra work within the latter phases.

Strikes broke out after ICA’s work floor to a halt. It has since restarted and the terminal ought to start working from July, one of many folks mentioned. Civil development work shall be fully completed by the tip of this yr, the particular person added. (Additional reporting by Noe Torres; enhancing by Grant McCool)

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