Dutch contractor Royal Bam Group has agreed to sell a portfolio of all 47 property development positions in the north east of the Netherlands to VanWonen Vastgoedontwikkeling.
Bam said the intended transaction was in line with its strategy of “building the present, creating the future”. It said that this would leading to the business portfolio being shaped and the property portfolio being reduced to less than €500 million by 2020. At 30 June, 2016, it stood at €699 million.
Bam said it was adjusting the property portfolio by converting residential property positions outside the core urban areas into cash, and using the proceeds to invest in equity light propositions in the core urban areas.
It said it would remain active in residential and non-residential construction, mechanical and electrical engineering and the development of non-residential property in the north east of the Netherlands.
The VanWonen Vastgoedontwikkeling transaction would reduce BAM’s property portfolio by approximately €44 million, and it is said to include an impairment of approximately €10 million for Bam in the fourth quarter of 2016.
It said that as there was no external financing on these positions, Bam’s cash proceeds would be around €34 million. It is expected that most of the transaction will be finalised in the first quarter of 2017.
Bam said that its outlook for the full year 2016, with adjusted result before tax predicted to be higher than the 2015 level, remained unchanged.