August 22, 2017 / 2:43 PM / 7 months ago

South Africa's Murray & Roberts raises stake in Gautrain firm

JOHANNESBURG (Reuters) - South Africa’s Murray & Roberts will increase its stake in Bombela Concession, which operates a rapid railway system in Gauteng province, to 50 percent from 17 percent for 405 million rand ($30.67 million), it said on Tuesday.

A newly constructed and still tested Gautrain arrives at O.R. Tambo International Airport outside of Johannesburg April 20, 2010. REUTERS/Peter Andrews/File Photo

Shareholders French conglomerate Bouygues and Canadian train maker Bombardier had agreed to each sell their 8.5 percent stakes to Murray & Roberts, the engineering and construction company said.

The Gautrain links Johannesburg, Pretoria and O.R. Tambo international airport.

Murray & Roberts, Bouygues, Bombardier Transportation U.K. and the Gauteng provincial government had been embroiled in a legal dispute over costs and contracts, which was settled last year.

“Subsequent to the settlement of the development period disputes in December 2016, Bouygues and Bombardier have decided to divest from BCC,” Murray & Roberts said in a statement.

“This acquisition is being undertaken as part of Murray & Roberts’ broader capital allocation strategy, as the investment in BCC provides strong returns in the short to medium term.”

($1 = 13.2038 rand)

Reporting by Nqobile Dludla; editing by Susan Thomas

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