BAM Advances on Tebodin Unit Sale, Book Gain: Amsterdam Mover

Royal BAM Group NV (BAMNB), the largest builder in the Netherlands, rose the most in five weeks after agreeing to sell its Tebodin unit and saying the transaction will result in a 65 million-euro ($87.5 million) gain.

BAM jumped as much as 4.4 percent to 3.58 euros, the biggest intraday increase since Jan. 23, and traded up 3 percent at 3.53 euros as of 10:25 a.m.in Amsterdam. The stock has gained 8.4 percent this year, valuing the Bunnik, Netherlands-based company at 823 million euros.

The construction company agreed to sell Tebodin, a consulting and engineering services provider, for 145 million euros in cash to Mannheim, Germany-based Bilfinger Berger SE (GBF) and said it will use the book profit mainly to reduce net debt. The companies expect to complete the transaction in the second quarter, BAM said in a statement.

BAM is “divesting Tebodin at an excellent price,” Michel Aupers and Micha Tiekink, Utrecht, Netherlands-based analysts at Rabobank International, wrote in an investor note. Including the disposal in December of its stake in dredging company Van Oord, BAM is free of recourse debt, a competitive advantage in today’s depressed construction markets, said the analysts, who have a “buy” recommendation on BAM stock.

BAM sold its 21.5 percent interest in Van Oord on Dec. 22 for 200 million euros to investment companies including Cobepa, Janivo, Breedinvest and Rinkelberg.

To contact the reporter on this story: Martijn van der Starre in Amsterdam at vanderstarre@bloomberg.net

To contact the editor responsible for this story: Mariajose Vera at mvera1@bloomberg.net

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