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|| Qatar Holding acquired 9.1% of German construction firm for $527 million

qh-hochtief.pngQatar investment firm Qatar Holding has announced the acquisition of a 9.1 per cent stake in German industrial firm Hochtief through an increase of share capital and investing $527 million.

Hochtief is already present in Qatar via five subsidiaries and employs more than 5,000 people locally.

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Their full press release follows

HOCHTIEF Aktiengesellschaft welcomes Qatar Holding LLC (Doha) as new major shareholder: HOCHTIEF increases the capital stock of the company by around ten percent under exclusion of subscription rights of existing shareholders. After acquiring all new shares, Qatar Holding will - as soon as the capital increase is registered with the commercial register - hold almost 9.1 percent of the new capital stock. The Ad-hoc Committee of the HOCHTIEF Supervisory Board has approved the capital increase. Qatar Holding LLC is the strategic and direct investment arm of Qatar Investment Authority.

- Capital stock to be increased by around ten percent under exclusion of subscription rights of existing shareholders
- After acquiring all new shares, Qatar Holding will hold almost 9.1 percent of the new capital stock
- Issue price of EUR 57.114 per share close to current stock price
- Total investment of almost EUR 400 million strengthens HOCHTIEF’s financial position and provides latitude for the announced further growth
- Investment will further consolidate the existing partnership

The capital increase will be carried out by partly making use of the authorized capital created at the HOCHTIEF General Shareholders’ Meeting on May 11, 2010, by issuing 6,999,999 no-par-value shares against cash contributions. According to the resolution of the General Shareholders’ Meeting, subscription rights of existing shareholders are excluded. The issue price is EUR 57.114 per share, resulting in an equity contribution of almost $529.83 million (EUR 400 million) to HOCHTIEF. "The cash inflow from the capital increase strengthens the financial position of HOCHTIEF. In addition, it provides latitude for the announced further growth after the planned bond issue had to be called off in mid-September," says CEO Dr. Herbert Lütkestratkötter.

Qatar Holding believes HOCHTIEF’s businesses are well positioned and have excellent prospects. As a world class investor, Qatar Holding supports best practices in corporate governance, financial management and stakeholder consideration. Qatar Holding‘s policy is to work with all stakeholders to help develop the business, preserve core values and maximise potential over the long-term.

The investment also offers both partners extensive strategic perspectives: Qatar is facing a fast technological, infrastructural and economic development. HOCHTIEF supports Qatar by transferring the most recent international know-how to the country, and by coaching local staff in state-of-the-art technology, like virtual construction or Building Information Modeling (BIM). Thus, the Group is already present in the country via five subsidiaries and employs more than 5,000 people locally. These are working on large-scale projects such as Barwa Commercial Avenue, a more than 8-kilometer-long commercial and shopping avenue in the capital Doha for around EUR 1.3 billion. Since 2008, HOCHTIEF as partner in a joint venture has also been planning the Qatar Bahrain Causeway, the longest inter-state connection in the world.

Moreover, in April 2010, HOCHTIEF founded a joint venture with Lusail Real Estate Development Company, a subsidiary of Qatari Diar. The current major project of the company is the development of a completely new city in Qatar by 2020, the city of Lusail which is designed for 200,000 inhabitants, and which will host the World Cup Final in 2022. The joint venture is also planning to export design and construction work to other countries.

Both partners have decided to take the historic opportunity and consolidate the existing cooperation by a direct participation in HOCHTIEF: "We welcome Qatar Holding as our new major shareholder. Qatar has recognized the capability of the HOCHTIEF Group, the success of our strategy as well as the benefits of a close partnership. We will now be supporting each other in our development," Lütkestratkötter announces. According to the CEO, Qatar’s strong relationship with the German state was a key element of its decision to invest in HOCHTIEF.

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