Skanska is being tipped to buy Kvaerner’s construction arm as speculation about the Swedish giant’s UK shopping list continues.
Analysts believe Kvaerner’s construction division could be a target because Kvaerner has been concentrating its efforts on its oil business. It is currently bidding for Norwegian oil and gas rival Aker Maritime.
Kvaerner’s £334m bid for Aker follows Aker’s purchase of a 26% stake in Kvaerner last month. The deal, which would create the world’s third-largest oil and gas services firm, was last week rebuffed by Aker’s principal shareholder, the Norwegian entrepreneur Kjell Inge Rokke.
Skanska said in May that it planned to make a major acquisition in the UK before the end of 2000. The firm has already been linked with bids for Carillion, Balfour Beatty and Amec.
One analyst said it would get a keener price for Kvaerner’s construction arm than for the other UK targets suggested. He said: “Skanska is going to get a much more attractive price if it’s dealing with a vendor that wants a clean break.”
The analyst said Skanska would be particularly interested in Kvaerner’s construction and civil engineering operations, as well as overseas subsidiaries such as Hong Kong-based Gammon.
Another analyst agreed that they were a good match. He said: “Both firms speak the same language in business terms.”
Analysts are sceptical about bids for Amec and Balfour Beatty, both of whose shares have recovered strongly after slumps last year, particularly since the announcement of the chancellor’s Comprehensive Spending Review.
One said: “I don’t think it’s Amec. They are highly regarded now and you would have to pay a very full price for them.”
Another said: “If they really thought the business fitted well, why didn’t they bid for it when its share price was cheaper?”
Peter Wollin, Skanska’s head of investor relations, reiterated the firm’s interest in the UK but refused to say which firms were being targeted.
He said: “We are constantly looking into a market which we are interested in. I do not really know when [a buy] is going to happen.”
A Kvaerner spokesperson said construction was one of three core activities in the group and refused to comment on market speculation.
Chief executive Keith Clarke was quoted last weekend as doubting the possibilities of a management buyout, flotation or merger as viable future options for the construction arm if it did split from Kvaerner.
