Arabtec Holding announced plans on Monday to raise the share capital of its subsidiary, Emirates Falcon Electromechanical Co (EFECO), by AED500m ($136.1m)
The increase in capital will be used to grow the business by investing in equipment and machinery, enabling EFECO to bid for higher value projects, the Dubai-based builder said in a statement.
The capital will also enable EFECO to expand into other Gulf countries as well as Egypt and other North African countries, it added.
EFECO became a 100 percent owned subsidiary in October, when Arabtec Construction completed the acquisition of the remaining 45 percent stake in the company.
The acquisition was in line with Arabtec's strategy of growing its mechanical, electrical and plumbing (MEP) capabilities, the company said, adding that media speculation regarding an acquisition of Drake and Scull were baseless.
Hasan Abdullah Ismaik, managing director and CEO of Arabtec Holding, said: "The aim behind the significant capital increase is to create a leader and key player in the MEP Sector in the Middle East and North Africa region.
"EFECO already has a very strong backlog of over $1 billion, which we expect to grow substantially, and this will firmly establish the Company as a strong competitor in this vital sector."
Ismaik added: "EFECO is now well positioned for significant growth. In addition to a very strong and growing backlog, we also have a strong aspiration to develop the Company into a global leader in the MEP sector, and we have the right senior management, with some of the best in the industry, to grow the business and maximise shareholder value. "
EFECO was established in 2001 to offer MEP services to the construction industry in the Middle East through its operations in the UAE, Qatar, Jordan, and Saudi Arabia.
The company provides design, procurement, installation, testing and commissioning services for electrical, air conditioning, plumbing, sanitary works, instrumentations, telecommunication and fire-fighting systems in residential and commercial developments.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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