Australian Leighton Holding sells John Holland Group to Chinese construction firm

By Admin
Australia has approved the sale of Leighton Holding's John Holland Group, one the country's biggest construction firms, to China Communications...

Australia has approved the sale of Leighton Holding's John Holland Group, one the country's biggest construction firms, to China Communications Construction Company (CCCC).

The A$1.15bn ($879m; £593m) deal was announced last year but was subject to regulatory approval. State-owned CCCC is the world's fourth-largest building company. Australia said it welcomed foreign investment "where it was not contrary to [the] national interest".

"Foreign investment has helped build Australia's economy and will continue to enhance the wellbeing of Australians by supporting economic growth and prosperity," Treasurer Joe Hockey said.

John Holland has a more than 60-year history of operations in Australia and employs more than 5,600 people across eight countries.

Its recent projects include railway-related developments in the states of New South Wales and Victoria, a prison in Melbourne and a billion-dollar children's hospital in Perth, among others.

China's CCCC, together with its wholly-owned China Communications Construction Company International (CCCI), the arm that will take over John Holland, has a presence in more than 80 countries.

In 2009, the World Bank announced it had debarred CCCC for fraudulent practices around a road project in the Philippines. It said the firm was ineligible to work on any road projects funded by the bank until 2017.

Noting this issue, Mr Hockey said "appropriate arrangements had been put in place to mitigate any concerns".

Evan Lucas, a market strategist with IG in Melbourne, said John Holland had been under financial pressure for several years and had been a source of angst for Leighton, which bought it in 2000.

Wednesday's decision was the right step for promoting foreign direct investment in Australia and proved that suitable places could still be found for foreign funds, he said.

"Supply of work has been below trend and the amount of operators has ramped up over this period, increasing the pressure."

Mr Lucas said the deal would deleverage Leighton, add new funding to John Holland, and keep competition for infrastructure projects in Australia robust.

 

Share
Share

Featured Articles

How to lead a successful EDI migration process

Software developer Comarch, which has over 20 years of experience in data management, shares tips on the potentially challenging EDI migration process

Changing EDI provider & how to find the right one

How to find the right EDI provider for your business

Tinamu drone automation revolutionises inventory management

Swiss firm Tinamu transform building material inventory management with Automation and Drone Technology and redefine stockpile volume measurement

COBOD's BOD2 3D printer used to build a school in Ukraine

Construction Projects

All you need to know about Saudi real estate developer ROSHN

Construction Projects

Arcadis signs collaboration with Canadian start-up Niricson

EPC