Swedish contractor Peab will increase its holding in Finland's Lemminkäinen from the current 5.8% to more than 10% at the end of the month.

Peab currently holds 1.14 million Lemminkäinen shares, worth about € 23 million, and representing a 5.80% stake in the company. Peab Invest, a fully-owned subsidiary of Peab has a forward contract to buy a further 940,000 shares on or before September 28 in a transaction worth some € 19 million. This would take the total stake in Lemminkäinen controlled by Peab to 10.6%.

Commenting on the deal, Peab CEO Jan Johansson said, "We got the opportunity to acquire a major block of shares in Lemminkäinen and at the current price level, we see the share as an attractive financial investment with good expected yields. We made this deal because we believe in a good long-term development in the Nordic construction market."

Last year Lemminkäinen had revenues of € 1.89 billion, € 543 million of which were generated outside Finland. The company made an operating profit of € 29 million - a 1.5% margin.

With domestic revenues of € 1.35 billion last year, Lemminkäinen is one of Finland's largest construction companies. Its biggest rival is fellow Finn YIT, which had domestic sales of € 1.46 billion last year. Other key competitors are Swedish-owned. Skanska's Finnish operations had revenues of SEK 6.89 billion (€ 755 million) last year, while NCC Construction Finland had revenues of SEK 5.79 billion (€ 635 million) in 2010.

Lemminkäinen was ranked 53rd in this year's CE-100 league table of Europe's largest contractors.

Newsletter

Delivered directly to your inbox World Construction Week features the pick of the breaking news stories, product launches, show reports and more!

Sign up for free

Newsletter

Delivered directly to your inbox World Construction Week features the pick of the breaking news stories, product launches, show reports and more!

Go to newsletters