Vinci to acquire Cegelec

Vinci has reached an agreement to acquire French electrical engineering group Cegelec from Qatari Diar in an all-share deal. Qatari Diar is a real estate investment fund that is 100% owned by the government of Qatar. Following the deal it will be Vinci's second largest shareholder.

The addition of Cegelec to Vinci would add about 27000 employees in 30 countries to the construction group. It would also add about € 3 billion in annual revenues to its energy group, taking this divisions annual revenues past the € 7 billion mark. This would make it one of Europe's largest energy-related contractors.

Under the terms of the agreement, Vinci will acquire Cegelec in exchange for 31,5 million of its own shares, to be made up of new and treasury shares. Approval to issue new shares was granted at an extraordinary shareholders meeting in May.

Strategic partnership

Vinci is at pains to stress the strategic nature of the deal with Qatari Diar. As part of the agreement, Qatari Diar will nominate a director to Vinci's board, and will agree to hold a stake in Vinci between 5% and 8% for three years.

The two companies have worked together since 2007 in an effort to expand Vinci's presence in Qatar. This has led to the formation of the Qatari Diar-Vinci Construction Grands Projects (QDVC) joint venture that is currently carrying out feasibility studies into the proposed 40 km, € 3 billion road bridge between Qatar and Bahrain.

The deal is subject to a series of approvals, including those of employee representative bodies and competition authorities.

Vinci was ranked 1^st in this year's CE-100 league table of Europe's largest contractors, while Cegelec took 33^rd spot. The acquisition should cement Vinci's place at the top of the table.