Bloomberg News

Mota-Engil Jumps Most Since 1999 on Africa Orders: Lisbon Mover

February 03, 2012

Feb. 3 (Bloomberg) -- Mota-Engil SGPS SA, Portugal’s biggest construction company, advanced the most since 1999 in Lisbon trading after winning contracts in Malawi and Angola that total $1.2 billion.

The stock rose 20 percent to 1.25 euros at the close of trading in the Portuguese capital. The shares have climbed 21 percent this year, giving Oporto-based Mota-Engil a market value of 255 million euros ($334 million). Almost 1.84 million shares were traded, about 13 times the daily average volume in the past six months.

“We see the expansion of the company’s international operations as very positive considering the tough environment it is facing in the domestic market,” Bruno Silva, an analyst at Banco BPI SA, said in a research note. He has an “accumulate” recommendation on the stock.

A slumping economy and austerity measures aimed at complying with a 78 billion-euro bailout package from the European Union and the International Monetary Fund have led Portuguese construction companies to seek more work away from home. About 10 building firms file for bankruptcy every day, according to Portuguese construction industry group AICCOPN.

Mota-Engil will build a railway line in Malawi for Vale SA under a contract valued at $703 million according to a regulatory filing. Work on the railway, part of the Moatize coal mining project’s Nacala Corridor, is due to be completed in 27 months.

The Portuguese company will also be part of the group building the Calueque dam in Angola for the government. Other orders in Angola include a project to expand Sonangol EP’s gas stations and real estate projects.

--Editors: David Risser, Robert Valpuesta

To contact the reporter on this story: Joao Lima in Lisbon at jlima1@bloomberg.net

To contact the editor responsible for this story: Tim Quinson at tquinson@bloomberg.net


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