?
RESTRICTED
174243
MDLIAN 1857
(F) AOKI-TOBISHIMA-HAZAMA JV
AOKI (JAPAN)
TOBISHIMA (JAPAN)
HAZAMA GUMI (JAPAN)
CHINA INTERNATIONAL WATER AND ELECTRIC (CHINA).
4. THE CONTRACT VALUE IS IN THE ORDER OF POUNDS 1 BILLION. THE
RUMOUR MILL HAS STARTED UNUSUALLY EARLY ON THESE BIDS. I HAVE ALREADY HEARD FROM SEVERAL SOURCES (INCLUDING BOTH TRAFALGAR HOUSE AND BALFOUR BEATTY) THAT THE COSTAIN GROUP HAVE THE LOWEST BID AND BALFOUR BEATTY IS SECOND. FROM A CONSTRUCTION INDUSTRY
SOURCE I HAVE BEEN GIVEN THE FOLLOWING FIGURES:
COSTAIN GROUP
BALFOUR BEATTY GROUP
DUMEZ GROUP
BOUYGES/DRAGAGES GROUP
AOKI GROUP
KUMAGAI GROUP
HKDOLLARS 12 BILLION
HKDOLLARS 12.75 BILLION
HKDOLLARS 13.2 BILLION
HKDOLLARS 14 BILLION
HKDOLLARS 15.8 BILLION HKDOLLARS 16.8 BILLION.
5. THESE PRICES ARE CONSIDERABLY HIGHER THAN HONG KONG GOVERNMENT ESTIMATES. ALMOST ALL THE HIGHER THAN PREDICTED COSTS COME ON THE DREDGING SIDE, AND THERE IS A STRONG SUGGESTION WITHIN THE INDUSTRY THAT THE DUTCH DREDGERS HAVE GOT TOGETHER TO PUT IN CLOSE PRICES: IT IS SAID THAT THE DUTCH DREDGERS IN EACH GROUP DECLINED TO GIVE THEIR FIGURES TO THE REST OF THE GROUPS UNTIL THE VERY LAST MOMENT AND THAT ALMOST ALL GROUP LEADERS WERE SURPRISED AT HOW HIGH THE FIGURES WERE.
6. FOR THE BALFOUR BEATTY LED GROUP HYUNDAI ARE THE MAIN DREDGERS. THEIR PRICES ARE ALSO HIGH. THE BALFOUR BEATTY DIRECTOR PRIMARILY CONCERNED (PRENTICE) HAS TOLD US THAT THEY WERE VERY ALARMED WHEN RECEIVING HYUNDAI'S BALANCE SHEET (FOR THE CONSTRUCTION AND ENGINEERING SIDE OF THE GROUP) ONLY AT THE LAST MINUTE AND WHICH HAD TO BE SUBMITTED AS PART OF THE ACCOMPANYING DOCUMENTS. THIS SHOWED LIABILITIES FOUR TIMES THE SIZE OF ASSETS AND IT WAS ONLY AFTER A HEAVY ROUND OF INTERNATIONAL TELEPHONING (INCLUDING BALFOUR BEATTY'S CHAIRMAN) THROUGH THE NIGHT ON THE EVE OF THE BID THAT THEY DECIDED TO PROCEED. BALFOUR BEATTY SAY THEY ARE STILL WORRIED ABOUT HYUNDAI'S LIABILITIES.
7. THE BRITISH SHARE AND BRITISH CONTENT IN EACH GROUP IS LESS