March 30, 2009 / 10:46 AM / 10 years ago

Dubai's Drake & Scull says to set up Libyan unit

ABU DHABI (Reuters) - Recently-listed Dubai contractor Drake & Scull International is setting up a Libyan unit this year, its second venture in Africa, as it expands abroad and weathers a downturn at home.

The United Arab Emirates’ construction sector is suffering a sharp slowdown, with Dubai particularly hard hit, as developers halt or postpone projects and thousands of jobs are slashed.

“We are in the process of establishing Drake & Scull Libya,” Tawfiq Abu Soud, an executive director at Drake said at a conference organised by London-based MEED magazine in Abu Dhabi. “The prospects there are good, they need infrastructure ... power, water, utilities.”

Libya, with a population of 5 million and the biggest oil reserves in Africa, is undertaking a $126.5 billion five-year infrastructure redevelopment plan to modernise water and sanitation facilities and build airports, schools and houses.

Abu Soud said the firm, which already operates in Sudan, had a total order book of 5 billion dirhams.

Drake — which specialises in mechanical, engineering and plumbing businesses — began trading on the Dubai Financial Market earlier this month.

The company’s shares closed at 0.65 dirhams earlier on Monday and have fallen nearly 25 percent since its opening trade.

The firms’s chief executive Khaldoun Tabari told Reuters earlier this month Drake planned to spend as much as 500 million dirhams on acquisitions, including in Egypt and Qatar.

He said the company’s board had given its approval to buy two companies in Saudi Arabia and one in Kuwait that would compliment its MEP and civil work business, around mid-2009.

Earlier in March it won a contract worth 600 million dirhams to provide district cooling in Bahrain.

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