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Polar takeover imminent
00:00 12 Aug 1998
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Skanska's takeover of Finnish construction and property development
group Polar is expected to be concluded by the end of this month.
The purchase will not leave Skanska short of money to mount a bid
for Costain.
Skanska was Costain's white knight when it stepped in to defend the ailing construction group last October, taking 26 million new shares at a cost of £10 million, giving it a 7.6 per cent holding. Now, with Malay-sian group Intria, one of Costain's previous saviours, in financial troubles of its own, Skanska could find itself obliged to buy out Intria's 37 per cent shareholding in Costain to keep the UK contractor afloat.
A distress sale by Intria would allow Skanska to take control of Costain at minimum cost, provided it has enough cash - and it has.
Anders Karlsson, president of Skanska Europe, said this week: "The Polar move will not leave us short of money. There is no financial restriction for us."
Skanska's bid for Polar is "proceeding as planned" and is now in due diligence. Polar is the fifth-largest construction group in Finland with a £140 million turnover.
Skanska, currently the third-largest player, is poised to become market leader in Finland, the combined group's turnover running to £510 million.
Karlsson insisted that Skanska was not talking to Intria. "They have not said anything to us yet, so we are continuing as before. There are so many companies in the south east Asia region that have problems, that we don't follow any in much detail."
Asked if this might be a good time for Skanska to increase its shareholding in Costain, Karlsson said: "That is the one thing we do not comment on."
Since saving Costain last year, things have gone exceptionally well, said Karlsson.
"We are following the plan and things are in line with what we expected," he said. "We are bidding for work in the UK and are trying to be as active as we can.
"We are interested in the UK construction market, we want a presence and have a long-term view. We believe we have something to contribute.
"Skanska came out of a Scandinavian base and has grown internationally so that more than 50 per cent of our turnover is outside Sweden. Skanska is growing quickly in America and we have global activity, notably in Russia and central Europe.
"On the world arena, we have joint ventures with several contractors."
Skanska was Costain's white knight when it stepped in to defend the ailing construction group last October, taking 26 million new shares at a cost of £10 million, giving it a 7.6 per cent holding. Now, with Malay-sian group Intria, one of Costain's previous saviours, in financial troubles of its own, Skanska could find itself obliged to buy out Intria's 37 per cent shareholding in Costain to keep the UK contractor afloat.
A distress sale by Intria would allow Skanska to take control of Costain at minimum cost, provided it has enough cash - and it has.
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Anders Karlsson, president of Skanska Europe, said this week: "The Polar move will not leave us short of money. There is no financial restriction for us."
Skanska's bid for Polar is "proceeding as planned" and is now in due diligence. Polar is the fifth-largest construction group in Finland with a £140 million turnover.
Skanska, currently the third-largest player, is poised to become market leader in Finland, the combined group's turnover running to £510 million.
Karlsson insisted that Skanska was not talking to Intria. "They have not said anything to us yet, so we are continuing as before. There are so many companies in the south east Asia region that have problems, that we don't follow any in much detail."
Asked if this might be a good time for Skanska to increase its shareholding in Costain, Karlsson said: "That is the one thing we do not comment on."
Since saving Costain last year, things have gone exceptionally well, said Karlsson.
"We are following the plan and things are in line with what we expected," he said. "We are bidding for work in the UK and are trying to be as active as we can.
"We are interested in the UK construction market, we want a presence and have a long-term view. We believe we have something to contribute.
"Skanska came out of a Scandinavian base and has grown internationally so that more than 50 per cent of our turnover is outside Sweden. Skanska is growing quickly in America and we have global activity, notably in Russia and central Europe.
"On the world arena, we have joint ventures with several contractors."
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