Qatar becomes Vinci’s second-largest shareholder

Qatari Diar – fully owned by the emirate of Qatar – has become the second-largest shareholder in French construction company Vinci with a stake of between 5% and 8%. In exchange, Vinci acquires 100% of service provider Cegelec, which is set to add some €3bn in revenues to the French group.

Vinci and Qatari Diar, the real estate company fully owned by the emirate of Qatar, concluded an agreement yesterday that will effectively turn Qatar into Vinci’s second-largest shareholder.

The transaction will see Qatari Diar receive 31.5 million Vinci shares in exchange for transferring 100 percent of service provider Cegelec to the French firm. Negotiations for the partnership were started late last August and concluded yesterday with the signature of a binding agreement.

Under the terms of the partnership, Qatari Diar will sign a stable shareholding agreement obliging it to keep a stake in Vinci of between five percent and eight percent over the next three years.  Vinci will also benefit from a right of first offer, which can take a pre-emptive character in certain circumstances, for divestments by Qatari Diar amounting to more than one percent of the share capital.

Qatari Diar will have to propose a director to be appointed to Vinci’s board, who will also be a member of the company’s strategy and investment committee. Vinci’s largest single shareholder is its employment and savings fund, which owns 9.1 percent of the company. But the majority of the firm is held by several international and French institutional investors.

Vinci expects Cegelec to add some €3 billion in annual revenues with the transaction being earnings-enhancing as early as this year, the company said in a statement. Cegelec is present in more than 30 countries where it provides services to businesses and local authorities. The company employs 2,700 people.