Ground engineering firm says acquisition will help long-term expanision in South East Asia

Ground engineering firm Keller has agreed to buy Singaporean contractor Resource Holdings for an initial cash sum of £30.6m.

Keller said the acquisition of the specialist foundation contractor would “significantly strengthen” its operations in Singapore and help long-term expansion in South East Asia.

Resource specialises in large diameter bored piling in soft clays. In the year to 31 March, it reported an operating profit of £10.7m on turnover of £52m but Keller said it did not expect this level of profitability to continue in the short to medium term due to the impact of the recession on Singapore’s growth rate.

In addition to the £68m up front payment, the deal includes further payments of up to £22.4m based on future profits. Completion is expected by the end of October.

Keller chief executive, Justin Atkinson, said: “We are excited by this important acquisition, which will significantly increase the size of the group's operations in South East Asia and add further momentum to our move into heavy foundations in these attractive growth markets.”