Fletcher Building says it will be focusing on manufacturing building material moving forward, by divesting itself of its construction division
New Zealand business Fletcher Building has announced that it has entered into a binding agreement to sell its construction division to VINCI Construction (VINCI) for NZ$315.6 million (A$273.19 million).
This could increase by up to NZ$18.5 million (A$16.01 million) in aggregate pending the final outcome of a small number of key contracts for the division currently under negotiation, which would take the headline enterprise value of the transaction to NZ$334.1 million (A$289.21 million).
“Over the past year we have been clear that Fletcher Building’s future lies in being a focused building products manufacturer and distributor, supported by a strong balance sheet and disciplined capital allocation,” Fletcher Building MD and CEO Andrew Reding says.
“The sale of Fletcher Construction is a significant step forward in delivering that strategy, while continuing the work underway to simplify the portfolio, lower debt and improve shareholder returns.
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“Fletcher Construction is a great business with excellent people, deep technical capability and a proud legacy as one of New Zealand’s most iconic construction companies. Over many decades it has delivered some of the country’s most complex and important infrastructure projects, and that track record is a testament to the quality of its teams and leadership. However, following our strategic review in 2025, we received strong inbound interest for the Construction business.
“Having undertaken extensive market soundings, we are confident that the sale to VINCI is the right transaction for our shareholders, Fletcher Construction and the broader New Zealand construction industry. VINCI knows Fletcher Construction well and has a deep commitment to New Zealand and the country’s infrastructure pipeline. That makes it an excellent long-term owner for the business and its people, customers and partners. I believe Fletcher Construction will find a strong home with VINCI, whose strengths are well aligned with the business, and which has a proven track record of successfully delivering major infrastructure projects globally.”
The transaction is structured as the sale of Fletcher Construction Holdings together with its three New Zealand business units:
- Higgins: an integrated national civil construction business delivering major infrastructure, road maintenance, regional works and bitumen-based roading products.
- Brian Perry Civil: a specialist civil, structures and foundations contractor.
- Fletcher Construction Major Projects: which delivers large, complex infrastructure projects in partnership with public and private-sector clients, including contracts delivered in conjunction with Higgins and Brian Perry Civil.
The sale is expected to be completed by the end of the year, whereupon Fletcher Construction’s 2,300 employees will transfer to VINCI Construction.