Friday, February 19, 2010

Aabar to invest in Algeria auto plant, boring equipment firm

Abu Dhabi's Aabar Investments on Wednesday decided to take a minority interest in an auto assembling plant in Algeria.

The investment company will also own a majority 51 per cent in joint venture tunnel-boring equipment manufacturing company with Herrenknecht, a leading German firm that has large stakes in tunnel-boring equipment manufacturing.

The directors of the Abu Dhabi Securities Exchange-listed investment company have approved a 24.5 per cent stake in a joint venture with the government of Algeria and Ferrostaal, to build the first of three factories in Algeria, the firm said in a regulatory filing on Wednesday.

This is the first stage in executing the memorandum of understanding signed by the Abu Dhabi firm last year with the government of Algeria, and Germany's auto giants Ferrostaal, Rheinmetall, Daimler, Deutz, and MTU.

Up to 10,000 cars and trucks will be assembled each year at the plant as the North African country looks to establish an industrial base. Assembly is expected to start in 2010 following the modernisation or development of plants in Tiaret, Ain Smara and Oued Hamimine. The project will be led by the German truck manufacturer MAN Ferrostaal.

Daimler, Deutz, MTU and Rheinmetall will participate as technology partners providing licences and intellectual property. The investment in the auto manufacturing unit is the third major investment by the ADX-listed company 
this year.
It shook the stock markets last month by acquiring 70 per cent ownership of Arabtec Holdings PJSC investing Dh6.4 billion, at a share price of Dh2.3.

Aabar share price climbed as much as 1.32 per cent to close at Dh2.33 on Wednesday at Abu Dhabi Securities 

Aabar last week agreed to invest US$20 million for stakes in US aviation company XOJET Inc.

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