European giant behind $1.2bn deal to build California high speed rail

A joint venture between German and Spanish contractors has won a 97km section of the California high-speed rail link between Los Angeles and San Francisco.  

The work will be carried out by Dragados USA and the Essen-based contractor Hochtief through its Colorado-based subsidiary, Flatiron. 

The contractors are linked through their relationship with the giant Spanish contractor Grupo ACS, which owns all of Dragados and has a controlling interest in Hochtief.  

The design-and-build contract covers "package 2-3", which was awarded by the California High-Speed Rail Authority yesterday. 

The segment Flatiron will work on runs through California’s Central Valley from a point near Fresno south to near then Kern-Tulare county line. 

Design work is expected to take 18 months, with construction scheduled for late 2016 and continue for four years. 

Marcelino Fernandez Verdes, the chief executive of Hochtief said the deal was "an example of considerable investment in new and improved infrastructure in the US and a big step forward for the Hochtief Group". 

Shares in Hochtief rose 2.5% in Frankfurt after the news was announced. 

The news comes a week after the High-Speed Rail Authority awarded a Rail Delivery Partner contract to a team led by Parsons Brinckerhoff, which also included Network Rail Consulting from the UK and management consultant LeighFisher.  

The complete system is to open by 2029. The cost is estimated at $68bn, which would make it the most expensive public works project in US history.