Arabtec Saudi Arabia wins infrastructure contract

Greg Christofides, Arabtec Construction CEO.

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Arabtec Saudi Arabia has won an infrastructure contract in the kingdom, though refuses to disclose its identity.

The parent and the UAE’s biggest builder, Arabtec Holding, said the project is the third awarded to the subsidiary in the country, alongside a mandate to build 46 buildings in the Princess Noura bint Abdulrahman University in Riyadh and the construction of 5,000 villas and related infrastructure work for a residential project for Saudi Binladin, Saudi’s largest contractor.

The project win brings the total value of its wins up to an estimated SAR 1.5bn ($400m), Riad Kamal, chairman of Arabtec Holding, told investors.

Arabtec Saudi Arabia is a joint venture between Arabtec and Saudi Binladin, a structure in line with Saudi regulation that requires foreign firms to work with local partners. Arabtec made AED 121m from the JV in the first quarter of this year, according to the financial statement for the period.

Dubai-listed Arabtec has cited Saudi Arabia as a key area for contract work as it seeks to diversify away from its home market which has been significantly hit by a slowdown in project work in the last two years. The UAE contributed about 77% to total revenue during the first half of the year, Rasmala Investment Bank wrote in a report in August.

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FEATURED COMMENT Prudence must be exercised by main local contracotrs to ensure profitability and control of overruns. Entities in such a   2 Comments Read more comments »

Greg Christofides, CEO of Arabtec Construction, the company’s chief construction subsidiary that co-built Burj Khalifa, told an audience at a CW conference in September that the company has a particular focus on the Saudi market on the back of high government spending on new developments.

"Maybe because of the fact we had experience working in Saudi in the early 1980s, maybe because of our local experience in the GCC, we addressed it in a manner that worked out very successfully for us, so we were able to succeed in the short term in Saudi Arabia," said Christofides.