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THEREFORE, WE ARE LEFT BACKING J L KIER. IT IS QUITE CLEAR THAT THOMPSON IS SPREADING THE THREE INITIAL CONTRACTS TO ENCOURAGE INTERNATIONAL COMPETITION IN THE SECOND ROUND, AT WHICH STAGE THE CORFORATION IS LIKELY TO HAVE MORE REGARD TO PURELY COMMERCIAL CONSIDERATIONS AND THE FINER POINTS OF THE VARIOUS CREDIT OFFERS. I THINK IT IS EQUALLY CLEAR THAT THOSE CONTRACTORS WHO GET IN ON THE FIRST ROUND WILL HAVE A HEAD START AS THEIR PERFORMANCE ON INITIAL CONTRACTS WILL BE TAKEN INTO ACCOUNT: AND SEEN FROM HERE IT IS ALSO IMPORTANT PSYCHOLOGICALLY THAT WE ARE SEEN TO BE IN AT THE BEGINNING. IF WE REMAIN ALONE IN INSISTING ON THE STEP PROCEDURE, THIS MAY EFFECTIVELY DISBAR KIER, AS THE CORPORATION MAY WELL TAKE THE VIEW THAT KIER WILL ONLY QUALIFY FOR 7 YEARS
COVER ON THE CONTRACT IN QUESTION.
3. THE CORPORATION ANNOUNCED ON SATURDAY THAT TWO OF THE FIRST THREE CONTRACTS ARE BEING AWARDED, SUBJECT TO FINAL LEGISLATIVE COUNCIL APPROVAL ON THE GUARANTEE, TO THE HOCHTIEFF CONSORTIUM AND TO KUMAGAI GUMI, A JAPANESE FIRM: AND THAT THERE WOULD BE A FURTHER ANNOUNCEMENT ABOUT THE THIRD CONTRACT IN A WEEK OR TWO. THIS IS TO ENABLE KIER TO MEET THE CORPORATION'S DEMAND THAT IT SEEKS A SUBSTANTIAL PARTNER WITH JOINT AND SEVERAL LIABILITY BEFORE THE AWARD OF ANY CONTRACT. KIER HAVE BEEN HAVING TALKS WITH THE FRENCH FIRM BOUYGUES, BUT IT LOOKS AS THOUGH THESE MAY HAVE RUN INTO DIFFICULTIES. THOMPSON IS CONCERNED THAT J L KIER. COULD GET INTO DIFFICULTIES BECAUSE OF FINANCIAL PROBLEMS ON THE FRENCH SIDE OF THE GROUP. I WOULD BE GRATEFUL IF OPG (TO WHOM THIS TELEGRAM IS COPIED) COULD LET ME KNOW WHETHER THERE IS ANY UNDER- TAKING THAT WE CAN GIVE THE CORPORATION ABOUT THE INDEPENDENT
FINANCIAL POSITION OF J L KIER.
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