Kværner sells construction arm as restructuring continues

Anglo-Norwegian engineering and construction group Kværner ASA today announced it is to sell off all of its building and civil engineering interests�as well as its 50% share in Hong-Kong based Gammon Construction�to Swedish construction company Skanska AB as part of ongoing plans to focus its attentions on the oil and gas and industrial process technology sectors.


LONDON�Anglo-Norwegian engineering and construction group Kværner ASA today announced it is to sell off all of its building and civil engineering interests�as well as its 50% share in Hong-Kong based Gammon Construction�to Swedish construction company Skanska AB as part of ongoing plans to focus its attentions on the oil and gas and industrial process technology sectors.

The sale of Kværner Construction�valued at some 4.7 billion kroner, of which 2.3 billion will be in cash from Skanska�will net Kværner an accounting gain in the region of 700 million kroner, as well as eliminating the more than 1.6 billion kroner in goodwill tied to its holdings in Gammon.

Kværner Chairman Christian Bjelland said the sale "represents the next step in the transformation of Kværner into one of the world's leading international technology providers" and would also give the company "enhanced financial flexibility" to pursue its growth strategies.

"The sale of [the] construction [business] means a further sharpening of our strategic focus," added Pres. and CEO Kjell Almskog. "The future activities of the group will center on oil and gas and industrial process technology. With this added concentration of activities, Kværner is aiming to be among the leading global suppliers of technology an engineering services within its core areas."

All international activities currently organized under the construction business area, which account for annual turnover of 13 billion kroner and employ some 7,000 staff, are included in the sale.

Skanska Pres. and CEO Claes Bj&oringrk reckoned the acquisition of Kværner Construction is "a further significant step in our strategy to broaden our geographical market presence," which could open the door to certain "value-adding activities into new local markets."

"This acquisition gives us a leading position in the UK and also a significant presence in several Asian markets," added Bj&oringrk, "and I regard it as very important for Skanska�s continued development."

More in New Plants