Swiss developer Karl Steiner to sell 66% stake to Hindustan Construction

HCCHindustan Construction Co. (HCC) is all set to acquire a major stake in Karl Steiner AG, the Switzerland based real estate player.

The Indian construction firm will be picking up a 66% stake in Karl Steiner for now. However, the deal is still waiting for approval from the regulatory authorities of India and Switzerland. HCC has long term plans to take full control of the Swiss developer.

As revealed by Ajit Gulabchand, Chairman and Managing Director, Hindustan Constructions, the company will be buying out the rest 34% stake in Karl Steiner in 2014 from its sole owner Peter Steiner.

Hindustan Construction is looking at making its foray in the business of building office spaces, which has been a rapidly growing segment in the real estate sector, over the past some time now.

The commercial building space in India has been rising up at a rate of 40%. Arjun Dhawan, the President of HCC Infrastructure Ltd. (a wholly owned subsidiary of the parent HCC) said that even the margin in the space is high. He sighted that operating margin in commercial building space ranges between 3.5% to 5%.

Karl Steiner is a strong player in the office building space and has an expertise in air conditioning, security and green technology. This will give HCC the extra edge they will need to carve a niche for itself in this space.