Civmec begins due diligence on acquisition target

AUSTRALIAN heavy engineering firm Civmec Limited on Tuesday said it plans to acquire PT Global Industries Asia Pacific and has begun its due diligence for the purchase. No acquisition sum was disclosed.

The proposed acquisition would mean securing 21 hectares of "strategically located" waterfront land with deep-water access in Batam, Indonesia, Civmec said in a press statement. "The location and geometry of the land make it ideal for new activities such as the potential establishment of a spoolbase for shallow and deep-water subsea pipelines," Civmec said in a press release.

The terms of the acquisition would also include a "long-term collaboration agreement" with PT Global Industries Asia Pacific's parent company, Technip. The latter, based in Paris, has a market cap of 7.02 billion euros (S$10.2 billion), Bloomberg data showed. Civmec said it has worked with Technip on at least two projects linked to major oil companies Shell and Chevron.

"The proposed acquisition provides Civmec an excellent platform to grow our South East Asian business in addition to positioning ourselves in a strategic geographical location to service clients who are operating or have plans to operate in future growth regions of the world," said Civmec chief executive officer, Pat Tallon.