ECONOMY

Construction companies mobilizing in bid for survival

Greek construction firms are exploring different paths to lead themselves out of the crisis and onto the road of survival, given not just the massive slump in residential contracts but also the near complete halt to major public projects.

Losses have become the norm for almost every one of Greece?s construction firms. The state?s freeze on all payments has resulted in an accumulated debt of over 2 billion euros, a large chunk of which is already past its original due date. Within this context, the management of construction firms are trying and testing different strategies in order to adapt to the circumstances.

For Ellaktor there is hope to be found in the recent deal with Canada?s Eldorado for the sale of European Goldfields, which controls the gold mines in Halkidiki, northern Greece. The management at Ellaktor can look forward to several million euros in revenues from the sale of its stake, which will help it cover damages after taxes of 36.23 million euros that have already been recorded for the first nine months of 2011. Experts estimate that this deal may stave off the company?s need to look for a strategic investor, as rumor has it that for the past few months the group has been speaking with potential partners, though nothing has been officially confirmed.

Meanwhile, Ellaktor is speeding up the pace of its investments in the real estate market, while its subsidiary REDS a few days ago received the licenses to begin building a residential complex in Kantza, northeastern Attica, on a plot purchased from Kamba vineyards.

Firms are looking at gaining new contracts abroad as well.

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