India’s drive to consolidate small state-owned construction firms into bigger ones took a step forward last week when government firm NBCC India was revealed as the highest bidder for two other public consultants.
The purchase of the two smaller entities, HSCC and Engineering Projects (EPI), is expected to add $2.1bn to NBCC’s $11.6bn order book, reports Economic Times.
New Delhi-based NBCC, which had a turnover of $1bn in 2017, carries out construction and civil engineering projects for state and private sector clients. One of its projects is the New Delhi World Trade Centre (pictured), set to be finished in 2019.
Sealed bids for the companies were solicited in November last year, and opened last week. The amount offered has not been made public.
The double takeover is in line with the government’s policy of merging state-owned firms to create bigger ones to compete better in India’s huge, and growing, construction market.
HSCC specialises in healthcare consultancy, with an order book of $1.5bn. EPI carries out turnkey industrial infrastructure projects in the power, steel and petrochemical sectors around the world. Its order book stands at $500m.
This takeover, if it goes ahead, would allow NBCC to edge up the ranks of Indian construction companies. At present, it is the 14th largest entity by turnover.
NBCC was formerly known as the National Buildings Construction Corporation. It is one of seven "Maharatna" companies in India. These are large-scale public sector undertakings that are thought able to compete in commercial markets at home and overseas, and which have the freedom to invest up to 15% of their market value in projects.
Image: Artist’s render of NBCC’s New Delhi World Trade Centre, set to be finished in 2019 (NBCC)