GS Engineering & Construction Corp. (GS E&C) said on Friday it has agreed to sell its Spanish water treatment arm GS Inima Environment SA for $1.2 billion as part of a portfolio realignment to focus on core businesses.
The South Korean builder did not disclose the buyer.
However, sources in the construction industry has speculated Abu Dhabi National Energy Co. (TAQA), a state-controlled energy holding company of the United Arab Emirates (UAE), is the likely buyer.
GS E&C had been engaged in prolonged negotiations over the sale.
GS E&C took over GS Inima Environment from OHL Group, a Spanish construction company, in November 2011.
In a regulatory filing, GS E&C said the deal values a 100% stake in GS Inima at $900 million, adding that the final price is subject to change pending regulatory approval and contractual fine-tuning.
GS Inima has been active in seawater desalination facility construction in the Middle East, including a 2.4-trillion-won project in Oman and a 920-billion-won construction in UAE in 2023.
In 2024, the company earned 52.2 billion won ($37.5 million) in net profit on sales of 493 billion won.
GS E&C has been divesting non-core units to improve liquidity since last year.
In October, it sold GS Elevator Co. and Zeit O&M Co., an energy facility maintenance service provider, to Genesis Private Equity for undisclosed sums.
It fell into financial difficulty after halting new project activities between Apr. 1 and Nov. 30 of last year, following a structural collapse at an apartment construction site in Incheon, west of Seoul.
By Yu-Rim Oh
our@hankyung.com
Yeonhee Kim edited this article.
