SINGAPORE - Civmec, a mainboard-listed construction and engineering firm, announced on Tuesday that it has entered into a due diligence phase to acquire Global Industries Asia Pacific, a subsidiary of energy project management firm Technip.
The proposed acquisition will grant Civmec a 21ha waterfront facility in Batam, Indonesia. Civmec plans to develop the site to house multi-disciplined engineering capabilities and enable its venture into deep-water pipeline projects.
"The company believes that the considerable opportunities in the infrastructure and sub-sea sectors as well as the long-term outlook within the oil & gas and mining sectors substantiates the investment in what will be a state-of-the-art and internationally competitive facility," Civmec said in its announcement filed with the Singapore Exchange.
Mr Pat Tallon, chief executive of the Australia-based firm, added: "We will be well positioned to capitalise on the significant infrastructure expenditure planned for South-east Asia. The increased capacity allows Civmec to deepen our relationship with existing blue-chip clients globally, as well as bringing on board new regional clients."
The transaction is not expected to have any material impact on Civmec's financial performance for its financial year ended June 30 this year.
Civmec's shares dropped 3.41 per cent to 42.5 cents around 11.15am on Tuesday.
Last month, the counter was queried by SGX over a 20.7 per cent jump in share price between March 13 and 17. This was followed by a trade with caution warning by the bourse.