LONDON - Emergency services support company AssetCo PLC Monday said it has signed a 10-year joint venture with the Abu Dhabi government to build a 100-acre emergency services training facility, its first contract win in the region.Financial details weren't provided but AssetCo subsidiary AssetCo Abu Dhabi's managing director Gareth White told Dow Jones Newswires that, based on similar projects in the region, the company could expect a 15% return on capital from the joint venture.
The current figure estimated to build the site is GBP80 million. AssetCo will invest around GBP39 million, White said. A 15% return on this investment would come to a total return of GBP44.85 million.
White said the project was adequately funded but didn't rule out further fundraisings in order to support future contracts.
AssetCo, which raised GBP15 million in January through a share issue in its subsidiary AssetCo Abu Dhabi in order to support its activities in Abu Dhabi, said the joint venture would see it develop and manage the site, named Rabdan Disaster City.
Chief Executive John Shannon said the joint venture was the first of a number of projects the company has been involved in since October 2007 when it set up its international office in Abu Dhabi.
"Given the profile this contract will bring, and the partner we have with the government, we're very hopeful that this will open up a potentially large market," said Shannon. "The future of the business will be driven from outside the U.K."
White added that the company was in discussions with the government on a number of other projects but said the main focus for the moment would be on Rabdan Disaster City.
The site is part of Rabdan Academy and will train staff in areas such as safety, security, defense, emergency planning and crisis management.
Arden Partners analyst Ben Thefaut said the win was a "highly significant milestone" in the company’s development in the region.
Sticking with a "buy" rating, he said the contract broadens the company’s markets and reduces its dependency on the U.K.
Shares in the company rose on the news and at 1002 GMT were up 8 pence, or 13%, at 71 pence. The wider AIM market was up 0.04%.