The Xuzhou Construction Machinery Group (XCMG), a Chinese maker of heavy machinery, is negotiating with Brazil’s OAS engineering company to form a joint venture for the construction sector in Africa and Latin America, reports the newspaper O Globo.
XCMG will contribute capital, equipment and financing. OAS will in turn be responsible for know-how in construction and engineering projects, bringing to the new group its contracts outside Brazil.
The joint-venture will enable OAS to recover from the financial crisis caused by the “Lava Jacto” political scandal that led the company to bankruptcy in 2015. It will also allow XCMG, one of the world’s biggest construction machinery companies, to expand its business in developing countries.
If the deal goes through, OAS will be the first in a series of Brazilian construction companies to negotiate partnerships with Chinese groups.
In 2016, China Communications Construction was involved in negotiations to purchase Construtora Camargo Correa SA, one of Brazil’s biggest construction companies.
The China Gezhouba Group also revealed in 2016 that it was considering the acquisition of stakes in infrastructure companies in Brazil. (Macauhub)