Al Habtoor-Leighton to bid for projects

Dubai: Al Habtoor-Leighton will bid for major projects in the coming years following the acquisition of 45 per cent stake in Dubai-based Al Habtoor Engineering by Leighton Holdings - Australia's largest construction group, for Dh2.6 billion (A$870 million; $707 million).

Leighton, which has entered the UAE last year, has contracts worth $1 billion in the UAE, a company spokesperson told Gulf News yesterday. "The combined orderbook of Al Habtoor-Leighton is about A$4.5 billion, or just under $4billion," said Chris Gordon, Leighton International's general manager. "We have complimentary skills and with our expertise and Al Habtoor's local strength that will help us to participate in major projects in the coming years. Now we will be able to bid for major international projects."

The projects include a $550 million highway contract in Abu Dhabi linking Abu Dhabi with Saadiyat Island, a Dh234.88 million roads and infrastructure projects at the City of Arabia theme park and a Dh1.49 billion contract for the construction of a equestrian centre in Qatar.

Leighton International will have equal Board representation on Al Habtoor- Leighton and managing director of Leighton International, David Savage, will assume a direct role in the day-to-day management of the new business, alongside Al Habtoor's current chairman and managing partner Riad T Al Sadik. Leighton has the option to acquire further shares.

Al Habtoor-Leighton is expected to produce revenues of around $2.75 billion for 2007-08 (incremental 10 month impact for Leighton of $800 million) and revenues are forecast to be in excess of $3.2 billion in 2008-09.

"Our investment of A$870 million is funded through a mix of cash - $350 million (40 per cent) and non-recourse debt - $520 million (60 per cent) with the debt funding provided by Abu Dhabi Commercial Bank, EFIC, HSBC, mashreq and Royal Bank of Scotland. The financial structure enhances both the shareholder returns and risk mitigation," Leighton's chief financial officer Scott Charlton said in a statement.