Drake & Scull International (DSI) PJSC has announced that it has completed the acquisition of “Drake & Scull International Qatar L.L.C” (DSQ), a prominent Mechanical, Electrical and Plumbing (MEP) contracting company in Qatar.
The acquisition strengthens DSI position as a regional leader in the MEP contracting industry and allows greater access to the construction sector in Qatar, which is currently being fueled by substantial government investment.
The decision to acquire DSQ comes following a series of stringent financial and legal due diligence and feasibility studies carried out by SHUAA Capital, PricewaterhouseCoopers and Al Tamimi & Company.
“With this move, we have made significant progress in meeting our strategic objective to increase DSI presence in the region, thus enhancing our access to a broader range of construction opportunities," said Khaldoun Tabari CEO of DSI PJSC.
"This acquisition also reflects our confidence in the Qatar economy, where there is tremendous long-term growth potential. DSQ is a prominent player in the market with strong management that brings us complementary capabilities and greater geographical diversification. Reaffirming our ongoing commitment on profitability, the acquisition will also have an immediate positive impact on both our backlog and bottom-line performance, with strong potential for continued growth going forward," Tabari added.
According to IMF forecasts, Qatar’s real GDP growth is projected to rise by 7% in this year alone, which will result in greater government expenditure on construction and infrastructure.
DSQ, which was established in 2006, has undertaken a number of prestigious MEP projects including the West Bay Complex and QTEL Headquarters, and more recently the New Doha International Airport project (NDIA). The company’s backlog stands at AED 166 million as of January 2010, which would be entirely executed and consolidated by DSI PJSC as of January 1st 2010.
“Our MEP business stream is the backbone of DSI, and with over 40 years of regional experience and value engineering behind us in this field, we are entering the Qatari market with what we know best,” concluded Tabari.
Since listing on the Dubai Financial Market in March 2009, DSI PJSC has declared plans to expand its operations geographically, in addition to the diversification of its services, and has subsequently acquired two companies in 2009. The first addition to its portfolio was through 82% ownership of Passavant-Roediger, a German-based global developer of wastewater, water and sludge treatment technologies, shortly followed by a 75% stake in another MEP company, “Drake & Scull for Electrical Contracting” in Kuwait.