DSI receives contractor award letter for palace

Khaldoun Tabari, DSI CEO, talking to CW.

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Drake & Scull International, the MEP contractor, has received a letter of award from the main contractor on the Presidential Palace in Abu Dhabi for an AED400 million contract to provide services.

The company today sought to clarify via a statement on the Dubai Financial Market website that it was yet to receive a letter of acceptance from the client, and would not announce its work on a project until this acceptance was received.

Consolidated Contractors Company, the Athens-based construction giant, was named as the main contractor in August for the AED500 million project, which is based on the Ras al-Akhdar peninsula adjacent to the Emirates Palace Hotel. The Abu Dhabi Dutch Fountain is providing the enabling and piling works.

The Palace will exceed 160,000m² of built area and will contain several VIP wings, several buildings and accommodations for staff and military. The palace will be used by the UAE federal government.

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Drake & Scull International has this year continued its aggressive expansion policy across the Middle East, buying its subsidiary in Qatar and winning contracts in Syria and Sudan among other countries. It also set up a construction company – Drake & Scull Construction – in Saudi Arabia.

By summer the company had secured more than US $2 billion in contracts, although revenues from its contracts for the half year up to 30th June had fallen by just over a fifth to AED789 million from AED1 billion in 2009.

Last month the company said it had signed a letter of intent to acquire a Saudi Arabian MEP contractor, and plans a second acquisition.

The company saw net profits fall by more than 40% in both the three-month and six-month periods of 2010 compared to the equivalent periods last year based on “challenging time” in the industry, according to CEO Khaldoun Tabari.