BackWelspun Group exits from Leighton Holdings JV
Leighton buys out entire 39.9% stake in Welspun joint venture firm Leighton Welspun Contractors to consolidate ops
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Mumbai: Construction company Leighton Holdings Ltd on Tuesday said it had acquired Welspun Group’s entire 39.9% stake in its India-based joint venture company Leighton Welspun Contractors Pvt. Ltd to consolidate its operations in the country.
The $99 million cash transaction was concluded on 7 February with the simultaneous transfer of shares back to Leighton International, a wholly owned subsidiary of Leighton Holdings, the company said in a statement.
Welspun Group had acquired a 35% stake in 2011 and subsequently acquired additional shares in March 2013.
Following the recent acquisition, Leighton Welspun will now be renamed as Leighton India Contractors Pvt. Ltd.
Leighton India has presence in building, oil and gas and infrastructure projects. Some of the current projects include constructing India’s longest two-lane road tunnel in Jammu and Kashmir, a super luxury residential project in Gurgaon and three offshore pipeline replacement and topside replacement projects for Oil and Natural Gas Corp. Ltd.
Welspun could not be immediately reached for comments.
In March 2013, Welspun Group’s unit called Welspun Projects Ltd had transferred its 72% of its engineering, procurement and construction orders to Leighton Welspun Contractors Pvt. Ltd for an equity stake in the joint venture company.
In March, Akhil Jindal, head of group finance and strategy at Welspun Group, had said that his company had no expertise in executing EPC orders and it made strategic sense to focus on developer’s role for Welspun Group while Leighton can leverage on what they are good at.
On Tuesday, Jim Salmon, managing director of Leighton India, said his company continues to see long-term prospects in the India market and can go to the market as a single brand Leighton with the offerings of his group companies.
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