Fulton Hogan sale speculation 'totally incorrect', MD Miller says

Thursday 4th April 2013

Fulton Hogan, the privately held construction firm, has scotched speculation it's being prepared for sale as being "totally incorrect".

Managing director Nick Miller said the Christchurch-based company has engaged Credit Suisse and its local counterpart First NZ Capital to look at the firm's balance sheet. Speculation in the Australian Financial Review that Fulton Hogan is being prepared for sale is "totally incorrect", he said in a statement.

"As part of standard, prudent governance the investment banks concerned are simply advising on options to optimise Fulton Hogan's balance sheet," Miller said. "Fulton Hogan has a strong, stable and committed shareholder base and no current or foreseeable plans for fundamental changes to our ownership, beyond the buy-back of the cornerstone Shell shareholding which has been in progress since 2009."

Fulton Hogan has been looking at ways to strengthen its balance sheet by retaining more earnings and selling non-core assets such as forestry and land, and last year delayed two buy-back instalments for Shell New Zealand to consider a potential acquisition of some resource-based assets in New Zealand.

The company ended a near 30-year partnership with Shell in 2009, with a staggered buyback of the oil company's 37 percent stake.

The construction firm is bouncing back from torrid year in 2012 after constant rainfall stalled its Pacific Highway project in New South Wales and was seen as a major cause behind a 89 percent plunge in annual profit to just $7.9 million.

Since then Fulton Hogan has ironed out those difficulties and recorded a strong first-half result, with a forward order book of $3.7 billion.

BusinessDesk.co.nz

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