Mumbai: The Mumbai-based construction and infrastructure major Hindustan Construction Company today said that it is acquiring a 66-per cent controlling stake in Switzerland's second largest real estate total services contractor, Karl Steiner AG (KSAG) in an all-cash deal valued at 35 million Swiss Francs (CHF), subject to regulatory clearances in Switzerland and India.
HCC said KSAG will issue new shares to HCC and will use the funds raised by the capital increase for its Swiss operations, and the growth of its core business in India construction market.
''This acquisition has been carried out on grounds of strategic fit both to capture local market opportunity and to provide us with a presence for European expansion," said Ajit Gulabchand, chairman and managing director, HCC.
Under the terms of the agreement that support a smooth transition, KSAG's chairman and sole owner Peter Steiner will stay on as vice chairman and minority shareholder till 2014, when he will divest his remaining stake to HCC.
HCC expects to close the deal in the second quarter of 2010. Upon closing of the transaction, KG Tendulkar, Chief Operating Officer for HCC's group of companies, will lead KSAG and join the company's board.
Tendulkar and KSAG CEO Henri Muhr will manage the integration process.