2002 Press Releases
18/11/2002
Keller invests in joint venture in Spanish ground engineering market
Keller Group plc (“Keller”), the global construction services group, today announces that it has entered into a conditional agreement to create a joint venture business with Terratest Tecnicas Especiales S.A. (“Terratest”) – one of Spain’s leading ground engineers – to provide a wide range of geotechnical services in Spain. The joint venture company – to be known as Keller-Terra – will take over the ground engineering activities of Terratest and Keller’s “Vibro” ground improvement business in Spain. Terratest’s products - which include permeation grouting, anchors and nailing, micropiling and jet grouting - generated profit before tax of €4.3m (£2.7m) on sales of €22.5m (£14.4m) in the year ending 31 December 2001 and had net assets of €7.1m (£4.5m) as at that date, whilst the complementary Keller products generated profit before tax of €0.08m (£0.05m) on sales of €1.1m (£0.7m) in the same period. The initial consideration for Keller’s 51% stake will be satisfied by the issue of 3,029,000 new Keller shares to Terratest, which will be retained for a period of at least 12 months following their issue. Further consideration up to a maximum of £1.5m (to be satisfied by new Keller shares valued at their market value at the time the further consideration is due) will become payable in 2004 if Keller-Terra meets certain profit targets in the financial year ending 31 December 2003. The investment in Keller-Terra will be broadly earnings neutral in the first year, but will offer significant opportunities for future growth. Spain is now the fifth largest construction market in Europe, with high levels of infrastructure spend. As civil engineering represents some 25% of the market, it drives strong demand for widespread ground engineering applications. Through the partnership, Keller will be seeking to extend the use of its advanced “Vibro” technology as a quicker and cheaper alternative to traditional piling methods. Keller expects the acquisition, which is conditional upon the finalisation of certain ancillary documentation and formal registration processes required under Spanish law, to be completed by the end of this year. Tom Dobson, Keller Group plc Chief Executive, said: “This is an excellent opportunity for Keller to penetrate a growing and attractive market in partnership with Terratest, whose reputation and routes to market are well-established. The acquisition meets our strategic aim of further strengthening our global leadership in Foundation Services, whilst expanding our range of Specialist Services.” For further information, please contact: | Keller Group plc | www.keller.co.uk | | Tom Dobson, Chief Executive Officer | | | Justin Atkinson, Finance Director | | Jackie Holman, Company Secretary
| 020 8341 6424 | |  | | | Weber Shandwick | Square Mile | | | Reg Hoare/Josh Royston | 020 7950 2883 |
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