FNPF, FHL acquire 50% in NZ construction entity

Source: The Fiji Times
Author: Dionisia Tabureguci

The FIJI National Provident Fund (FNPF) and Fijian Holdings Ltd (FHL) will fork out a total of about $27million for their 50 per cent purchase of Higgins Holdings (Fiji) Pte Ltd, parent company for Fletcher Building (Fiji) Ltd.

The two mega funds announced on Tuesday they've entered into an agreement to buy 25 per cent each in the entity, which specialises in building and road construction works in Fiji.

Higgins Holdings Fiji's parent company Fletcher Building Ltd announced its divestment of the business on the Australian Stock Exchange where it is listed, and its put the transaction value at about $NZ20m ($F27.74m).

"The transaction values the Fiji business, comprising Fletcher Construction and Higgins branded operations, at approximately $NZ40 million," it stated.

"(Fletcher Building Ltd) will receive cash proceeds of approximately $NZ20 million for the sale of a 50per cent stake in the business."

FNPF chief executive officer Viliame Vodonaivalu said the Fund has a close relationship with Fletcher Construction - having engaged the renowned company in major construction projects, including the Fiji Marriot Resort at Momi Bay (completed in 2017), Sheraton Hotel refurbishment (completed in 2022) and the renovation of the Westin Denarau Island Resort & Spa which is currently underway.

FHL, whose exposure to the building and construction sector was $35.59m or 6.4per cent of its total investment portfolio in 2023, viewed the acquisition as having direct synergistic benefits with FHL's subsidiaries.

Fletcher Building Ltd, whose purchase of Higgins Group Holdings in 2016 included Higgins' Fiji operation, also expects to solidify the business through the two new institutional shareholders.

"We are pleased to enter into this agreement in Fiji with two strong local partners with whom we have a long-standing relationship," acting chief executive officer Nick Traber said.

"We believe the partnership positions the business well to continue to play an important role in Fiji, focused on infrastructure development."

Fletcher in Fiji has "a workforce of 700 Fijians and is the largest construction company in Fiji," according to FNPF.

The parties expect to complete transaction later this month or early next month, conditional on regulatory approvals.