Arabtec and Samsung form joint venture
Joint venture to target the oil and gas industries
The joint venture between Arabtec and Samsung will be split 60%-40% between the two companies, with the construction firm taking the larger share.
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Arabtec Holding, the Arabian Gulf’s largest publicly traded construction firm, has formed a joint venture with Samsung Engineering Co to further its expansion in the oil and gas industry.
Arabtec-Samsung Engineering will be 60% owned by Arabtec and 40% owned by Seoul-based Samsung Engineering. New management will be appointed shortly, according to a statement by the two companies.
Arabtec has recently signed a 10-year agreement to lease the 59-floor office tower in Abu Dhabi where Arabtec Construction and Arabtec-Samsung Engineering will be based, the company’s chief executive officer Hasan Ismaik said.
The joint venture will “undertake large-scale projects in oil & gas, power and infrastructure in the Middle East and North Africa,” a spokesman for the companies said.
Arabtec-Samsung will bid for contracts ranging from $3 billion to $10 billion in value. Samsung Engineering currently has a $10 billion contract backlog in the Middle East regions.
Arabtec, which helped build the world’s tallest tower in Dubai, in February replaced its management and said it plans to more than double its market value.
The UAE-based company also said it’s planning to raise $1.7 billion through a bond and share sale. The proceeds will be used to bolster the company’s oil-and-gas installation business and expand its affordable housing capacity, Arabtec said in March.
