Weaker markets in France had prompted Bilfinger Berger to sell its French subsidiary Razel, active in tunnelling and earthworks, to construction group Fayat.
The sale to the French group is subject to regulatory approval. Berger said that this year Razel should generate output volume of approximately US$637M. Fayat said the move would help it strengthen its position in the public works construction market.
Razel is mainly active in France, where it has worked on tunnelling projects such as metros in Toulouse and Rennes, the 5.4km long TGV tunnel in Marseilles and various road projects. It is also active more widely in civil engineering and geographically in Europe as well as francophone Africa, and has been part of the Berger group for 13 years.
Berger added that the divestment is expected to generate proceeds of US$175M and deliver a capital gain of US$115M.
At group level, Berger is establishing a risk provision to reflect construction market volatility going forward. However, it said that for the current year its net earnings should reach approximately US$236M, which is a third more than in previous forecast.
