Arabtec will complete its acquisition of Target Engineering within the next few days.
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Arabtec, the Dubai based construction firm, has announced that it plans to complete its acquisition of Target Engineering as it looks to move into the oil and gas construction market, sources said on Monday.
The contractor already owns 60% of Target, having bought into the firm in 2007, two sources close to the deal told Reuters. The oil, gas and marine specialist has operations in the UAE, Qatar and Saudi Arabia. The unlisted firm’s turnover was $387mn in 2012, its website said.
Arabtec is set to announce the remaining 40% acquisition of Target within the next few days, the newswire added. No valuation of the deal was immediately available.
Target Engineering’s current work in hand, as of the end of 2012, was $310mn, with turnover for 2013 estimated to be around $447mn.
“This makes perfect sense for Arabtec considering their plans to grow the oil and gas business. Target is well experienced in such projects and their work is growing,” said an analyst who did not wish to be identified.
Arabtec underwent a management shake-up in February, driven by its biggest shareholder, the Abu Dhabi based investment fund Aabar, which saw its chief executive replaced.
The contractor said it would rely on the reputation of its biggest shareholder and proceeds from a planned $1.8 billion capital raising to expand its business. Aabar owns stakes in companies such as commodities trader Glencore and Italian bank UniCredit .