Dubai: Arabtec Holding Co., the UAE’s biggest construction company by market value, won a Dh453 million contract from OAO Gazprom to build Europe’s tallest office tower in St. Petersburg.

The Dubai-based company and Gazprom unit Okhta Centre will begin the first phase of construction for the 463 metre-high (1,519 foot) Gazprom Tower, Arabtec said in a statement to the stock exchange on Monday. The headquarters of Russia’s natural gas exporter and oil arm will be located in the tower, Arabtec said.

Arabtec has been expanding outside of Dubai after profit fell each year following the 2008 property market crash. The builder, which derived all revenue from the Gulf Cooperation Council (GCC) last year, said on Monday it expects to win more projects in Russia. Arabtec’s Target Engineering Construction unit also won Dh270 million of contracts in Abu Dhabi and Qatar, the company said in a separate statement.

Arabtec’s shares have surged 66 per cent this year on bets the builder will benefit from regional infrastructure spending, outpacing the 17 per cent advance in the benchmark Dubai Financial Market (DFM) General Index. Abu Dhabi government-controlled Aabar Investments PJSC raised its stake in Arabtec this year to 21.6 per cent, fuelling bets it’s poised to win more contracts in the UAE capital.

Arabtec shares gained 0.4 per cent at 10.08am in Dubai after jumping 3.3 per cent on Sunday, giving the company a market value of Dh3.97 billion.

Contract for terminal

The company in June won a contract valued at about $3 billion (Dh11.02 billion) to build a terminal at Abu Dhabi Airport along with partners, including TAV Insaat of Turkey. The second phase of the five-year project in Russia includes two more buildings and other facilities, Arabtec said.

Gazprom in 2010 won final approval from the Russian government to build the tower as it relocates from Moscow, even after the project faced a public outcry from protesters who said the building would spoil the city’s historic skyline. The tower was initially designed to become Europe’s tallest skyscraper.

Arabtec, which has the fourth-heaviest weighting on Dubai’s gauge, may post a 72 per cent slump in third-quarter profit to Dh11 million, according to the median estimate of three analysts on Bloomberg. The shares are trading at 17 times estimated earnings compared with 10.5 times for the Dubai benchmark.