According to The Australian Financial Review, one of Japan's largest builders, Kajima Corporation, is accelerating its investment into the local construction industry, taking a majority stake in busy mid-tier player Cockram.
The tie-up with Cockram, which has a company history dating back to 1861 in Melbourne, is the second major move locally for Kajima, which took a controlling share in Icon Co two years ago.
The multibillion-dollar Tokyo-listed builder aims to merge its two Australian investments by 2019 under a new brand.
That will give the new entity, backed by the balance sheet of its powerful Japanese investor, enough firepower to rival established tier-one construction firms run by Lendlease, the former Leightons, CPB Contractors, and Multiplex.
By 2019, the new Kajima-controlled entity expects to be generating annual revenue of about $2 billion.
The Kajima investment would give Cockram the financial resources and technical expertise it needs to grow its existing social infrastructure market locally.
It would also help Cockram expand its international business in Asia-Pacific and the United States where demand was growing, Mr Batten said.
Founded in 1840, the Tokyo-based Kajima is one of Japan's big five builders, with annual revenue of $21 billion and worldwide operations.
"The Japanese market doesn't offer us high growth opportunity. The construction market is pretty much matured," said Motohiro Umehara, the managing director of Kajima Australia.
"The company needs to look offshore for growth. Australia offers us a large, transparent construction market which brings growth opportunities."
The mooted merger will combine Icon's residential and commercial construction expertise with Cockram's specialist social infrastructure business.
"Our experience with Icon has been very successful. Kajima's financial and technical support has accelerated their growth. They will achieve around $1 billion in revenue this year."
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