SINGAPORE (Mar 11): DLF Holdings, the mechanical and electrical (M&E) engineering firm, is entering a 80:20 joint venture (JV) agreement with Prosper Environmental Engineering to collaborate on a work order awarded to the latter to construct the living quarters of a marine admiralty yard.
As a contractor under the work order for an unnamed ‘leading player in the marine engineering industry”, Prosper is to fabricate, erect and install all structural and associated steelwork while providing the necessary management, labour, tools, equipment, services and consumables for the project.
Under the JV agreement, DLF will receive 80% of the work order profit from Prosper on an 80-20 basis between July 2 2018 and the project’s expected completion date on 17 July 2019.
According to the group, this profit-sharing proportion is based on the provision of project co-ordination and management services, and project funding services by the JV company to support the performance of contract works by Prosper.
DLF says in its filing on Sunday that it believes the JV is in line with its plans to expand its business through JVs with parties to strengthen its market position, add value to its existing business, and provide it opportunities to diversify the group’s revenue stream.
This is considering how the JV combines both parties’ expertise by leveraging on their mutual respective strengths and expertise by allowing DLF to tap on Prosper’s stronghold in maritime services, while at the same time giving Prosper access to DLF’s experience and knowhow in M&E engineering services.
DLF does not expect the JV to have a material impact on its financials for FY18 and FY19.
Shares in the group closed 1.1 cent higher at 20 cents on Friday.
