Two prominent UK and Chinese companies are bidding for the contract to build the 500 million U. S. dollar Colombo South Harbor Container Terminal in Sri Lanka, an official said here on Wednesday.

UK group Boskalis International, along with China Harbor Engineering Corp and China State Engineering Corp are the three companies engaged in the bidding.

The official who did not wish to be named confirmed that the winning bidder will be selected in December and construction will begin in January.

"This is the largest foreign direct investment that Sri Lanka has received since the end of its three decade conflict in 2009. The joint-venture shell company that will develop and operate the terminal will be formed this month. It is expected to be titled Colombo International Container Terminals," he said.

Under the current deal China Merchant Holdings International will have 55 percent stake in the venture, Sri Lanka's Aitken Spence will hold 30 percent and the Sri Lanka Ports Authority 15 percent.

The new terminal will add 2.5 million TEU (Twenty-foot Equivalent Unit) to the Colombo Port's capacity and will be able to accommodate the new-generation vessels carrying up to 18,000 TEU making it one of the largest ports in South Asia.

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