Canadian construction company Aecon has withdrawn from the public-private partnership consortium bidding to build the Gordie Howe bridge between Ontario and Detroit, saying it is just too busy.
The company, presently the subject of a controversial takeover offer from China Communications Construction (CCCC), had been part of the Bridging North America consortium along with Spain’s ACS and two American engineers, Aecom and Fluor.
Withdrawing from the US$2.1bn scheme had nothing to do with the proposed $930m takeover by the state-owned CCCC, John Beck, Aecon’s chief executive, told Bloomberg.
He said the decision was due to Aecon being too busy to commit the resources needed to get the project started. "We’ve picked up over C$2bn (US$1.5bn) of business. We already have C$4bn worth of backlog. Not only do we have to execute them but we also have to start them all up over the next few months," he said.
One such scheme is the US$1.9bn Finch West Light Rail Transit project in Toronto, which reached financial close yesterday. Aecon is undertaking this with ACS, as well as the Canadian arm of Ireland’s CRH Group.
The Gordie Howe bridge, named after a Canadian ice hockey legend, will take over from the Ambassador bridge between Detroit, Michigan and Windsor, Ontario. The Ambassador presently carries about 2.5 million cargo trucks a year, around 30% of all lorry traffic between the US and Canada.
CCCC’s takeover of Aecon is being reviewed by the Canadian government on national security grounds, and a decision is expected before the end of June.
A number of large Canadian contractors, and trade body the Canadian Construction Association, have opposed the takeover on the grounds that, as a state-owned company, CCCC would have unfair access to Chinese state funds, and could be influenced by political agendas.
However, Aecon’s John Beck recently argued in the Globe and Mail that the deal would lead to "more high-quality jobs for Canadians in communities across the country, as Aecon will be in a much stronger position to compete with the many large foreign companies already operating in the country, but without a large on-the-ground presence".
He accused those opposing the deal of wanting to limit competition in the Canadian market and pointed to the success of two previous CCCC acquisitions, Houston-based Friede & Goldman and Australia’s John Holland, both of which have prospered under their new owner.
CCCC, listed on the Hong Kong Stock Exchange since 2006, has a market capitalisation of $38bn and is the world’s fourth largest contractor.
Image: The Gordie Howe Bridge will replace the Ambassador’s bridge (Mike Russell/Creative Commons)
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