Chinese construction bank Pepper Construction Bank has bought construction equipment firm Huanxi Jinsheng Construction Co., Ltd.
for $1.2 billion, the company said on Tuesday.
The deal comes as China’s construction industry faces a new wave of capital outflows as its economy slows.
The stock was up more than 4 percent in Beijing.
Huanxi is a joint venture between Jinshen Construction Co. and the China Construction Bank.
The joint venture will focus on the supply chain for building projects in China, the Chinese-language state news agency Xinhua reported.
Huge construction projects are set to take place in China.
China is the world’s second-largest construction market, with the country’s construction spending estimated at nearly $1 trillion in the fourth quarter.
Hans Pfeiffer, CEO of Pepper Construction, said the acquisition of Huanxing Jinshens construction company, which will focus in China’s infrastructure, will help expand the company’s presence in China.
“This acquisition will help HuanXing Jenshens project portfolio and strengthen Pepper Construction’s international business.
The transaction will also strengthen Pepper’s competitive position against other international firms, including those in the construction sector, he said in a statement.