Astaldi may bid for Turkish rail projects
Istanbul, October 28, 2010
Astaldi, Italy's No. 2 builder, wants to build hospitals, railways and power plants in Turkey because of its rapid economic growth and strategic position between Europe and Asia, Chairman Paolo Astaldi said Thursday.
Astaldi is also interested in transportation projects in Abu Dhabi and Oman, Paolo Astaldi told Reuters in Istanbul before a groundbreaking for a $6.5 billion road project in western Turkey.
Europe's fastest-growing economy already accounts for about 10 percent of Astaldi's total revenue, making it the company's second- or third-biggest market after Italy, he said. Astaldi earns 55 percent of its revenue from overseas.
"Turkey is a country where we would like to strengthen, to increase our presence," Paolo Astaldi said.
"It has a great programme of investment in public infrastructure, this helps the economy grow. Turkey is in a geographic position in the middle of big trade routes so they need to strengthen their transportation sector," he said.
He also cited Turkey's political and fiscal stability as attractive aspects.
"Turkey is a country that offers prospects for the future. Italy, in this way, gives different prospects: less big national infrastructure projects and more local projects," he said.
The Rome-based company will join a tender to build a portion of the Marmaray railway, a $1 billion scheme to link Istanbul's European and Asian sides, and is interested in other rail projects as Turkey seeks to expand its aging network, he said.
Astaldi is also interested in building hospitals under a new public-private partnership (PPP) model the government is introducing and may invest in hydroelectric power plants.
Oman, Abu Dhabi projects
"We have identified a couple of countries; one is Abu Dhabi and the other is Oman," he said. "In Oman we are basically focusing on highways and in Abu Dhabi we ware still scouting opportunities. Rail could be a possibility there."
Astaldi is awaiting the result of a Libyan road tender and has no immediate overseas acqusition plans, he also said.
Astaldi last year won a Turkish contract to build, operate, transfer a 420-km (260 miles) highway connecting Istanbul and Izmir that will more than halve travel time. The project includes a 3-kilometre suspension bridge that traverses an area lying on one of Turkey's most active earthquake faultlines.
The project will be completed in seven years. Paolo Astaldi declined to say when he expects to recoup the investment.
The company may receive support from the Italian export agency SACE to finance the road's construction, which it will funded through a mix of loans and equity, he said.
US-based Citibank Italy's Intesa and Turkey's Akbank are advising on project financing.
Astaldi expects 2 billion euros in sales this year and expects to grow by an average of 10 per cent annually until 2015.
"The rate of growth in profit will remain more or less the same so we expect to have something like 60 million euro profit," said Paolo Astaldi, when asked for the end-year outlook. – Reuters