Monadelphous seeks Norfolk link

PERTH-BASED engineering and construction company Monadelphous Group hopes to strengthen its competitive position if it succeeds with plans for a closer link with Sydney-based contractor Norfolk Group. Monadelphous disclosed it had acquired a 12 per cent shareholding in Norfolk, which owns national electrical engineering firm O’Donnell Griffin and other subsidiaries in the mechanical and property services sectors. Managing director Rob Velletri said the acquisition supported the group’s diversification strategy. “Monadelphous has for some time been assessing opportunities to broaden our exposure to non-resources sectors and expand our range of services,” he said. A Norfolk spokesman said the two companies had worked on several big projects together and saw the investment as a positive endorsement of the company’s operations. These included BHP Billiton Iron Ore’s expansion projects in the Pilbara. Hartleys analyst Nikki Ermongkonchai described the prospect of Monadelphous and Norfolk working together as a positive development. “The big plus would be the strategic advantage,” she said. “It would boost their position as an integrated service contractor.” Ms Ermongkonchai said O’Donnell Griffin has an estimated 10 per cent share of the national electrical engineering market, with a strong presence on the east coast construction and infrastructure markets, which would be new territory for Monadelphous. The Norfolk spokesman said O’Donnell Griffin had been particularly successful in the rail sector. It was part of a consortium that was named last November as preferred contractor for a $1 billion five-year rail services contract in New South Wales.

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