Hochtief AG, Germany’s biggest construction company, agreed to buy Longmont-based Flatiron Construction Corp. from Royal BAM Groep NV to add a bridge builder to its commercial property operations in North America.
Hochtief will pay $240 million for Flatiron, the Essen- based builder said in a statement Tuesday.
The acquisition should have no significant effect on Flatiron’s workforce of 1,700 nationally and 200 in Colorado, said Paul Driscoll, chief financial officer of Flatiron.
“The real effect is that it brings us a party that is interested in further expanding into the markets we serve,” Driscoll said, including public-private projects for bridges and highways.
Flatiron, which helped build the Bay Bridge between Oakland and San Francisco, has been selected for the contract to rebuild the Interstate 35W bridge in Minneapolis that collapsed into the Mississippi River last month, killing 13 people, a spokesman for BAM said Sept. 21.
The purchase of Flatiron will add $626 million of sales to Hochtief’s U.S.-based Turner unit, the country’s biggest builder of hospitals, schools and hotels.
BAM will have no remaining U.S. operations after the sale, as it turns its attention to the Benelux countries, Germany, Ireland and the U.K.
“The market expected the price to be somewhat higher,” said Tijs Hollestelle, an analyst at ING Wholesale Banking in Amsterdam. “Strategically, it’s a good move for BAM to focus on European construction.”
BAM will book a one-time gain of $99 million from the sale and the Bunnik, Netherlands-based company raised its profit forecast for this year.
Rising demand for new houses in the Netherlands prompted BAM on Sept. 6 to raise its 2007 profit forecast by 10 percent.
Denver Post staff writer Steve Raabe contributed to this report.
