Meed | EXCLUSIVE: Alec acquires Abu Dhabi contractor Target

EXCLUSIVE: Alec acquires Abu Dhabi contractor Target

16 December 2022

Dubai-based contractor Alec has completed the acquisition of Abu Dhabi contractor Target Engineering Construction Company. The $100m deal creates a contracting group with cross-sector capabilities that hopes to double its turnover in the next five years.

Alec is one of the region’s leading building contractors and is working on landmark projects such as One Zabeel in Dubai and the Natural History Museum in Abu Dhabi.

Target is an engineering, procurement and construction (EPC) contractor working on oil and gas projects including the Borouge 4 petrochemicals complex in Abu Dhabi and the North West Development of the Dalma field, also in Abu Dhabi.

Ambitions to double size

Target, previously owned by Arabtec, has an annual turnover of about AED1.5bn ($408m) and is a significant addition to the Alec business.

“Target will constitute about 30 per cent of our [combined] turnover,” says Kez Taylor, CEO, Alec.

“Going into the future, we see both businesses growing because there is work out there that needs to be executed for both Alec and Target. We see the size of both businesses doubling over the next five years.”

Although Alec and Target are both contractors, their operations are complementary.

“It is a very good fit for us,” says Taylor. “We do complex building jobs; they do oil and gas, energy and marine.”

We have been able to save 11,000 jobs and keep a company working

John Deeb, CFO, Alec

Workforce of 21,000

In terms of manpower, the group is now one of the largest in the region. Target has a workforce of 11,000, and together with Alec’s 10,000, the group has a total workforce of 21,000.

“We feel we have a good cultural mix because they are contractors and are similar to us. When we interact, we talk the same language,” says Taylor.

While both companies will assist one another and work together, in terms of management, Target will continue to have its own management.

“Target will run Target and we will allow them to operate,” says Taylor.

Financial standing

Alec was able to complete the acquisition thanks to its strong financial position.

“We don’t have debt as a business. Over the years, we have actually avoided it. We have a strong balance sheet and that’s why we were in a position to make a move like this,” says Taylor.

Target was available for sale after its previous owner Arabtec filed for bankruptcy in 2020.

“It started when Arabtec went under,” says John Deeb, CFO, Alec. “If you look at Alec in the past, we’ve never really done big acquisitions. We have grown our businesses organically, so we weren’t looking [to acquire].

“Oil and gas was something we had been looking at. We wanted to do something, and then when Arabtec went insolvent, we talked to people about what was good at Arabtec because obviously it wasn’t all bad. Target was the one thing that stood out.”

Bankruptcy law

The Arabtec insolvency has been a key test of the UAE’s bankruptcy law, which came into force in late 2016.

“This deal is one of the first to show how the process works,” says Deeb. “We have been able to save 11,000 jobs and keep a company working.”

Acquisition benefits

The acquisition helps Alec diversify its business and gain access to one of the region’s most active sectors.

“We have focused on the high-end building market. We haven’t done roads, bridges – we decided to stay away from that, but oil and gas is something that does make a lot more sense as the barriers to entry are higher and it’s more challenging work,” says Deeb.

The outlook for investment in projects in the oil and gas sector is backed by strong economic fundamentals and the increasingly important energy transition.

“The UAE has the capacity to produce 4 million barrels a day (b/d) and they want to get it up to 5 million b/d by 2027. In Saudi Arabia, they are producing about 10 million b/d, and they want to increase that to 13 million b/d. That’s a 25 per cent increase for the UAE and a 30 per cent increase for Saudi Arabia. Coupled with that, you have net-zero targets,” says Taylor.

Geographically, the two main markets for the group are Saudi Arabia and the UAE.

“There is a huge amount of work to be done. The market share in the UAE for Alec is about 2 per cent and in Saudi Arabia, we see it being about 1 per cent,” says Taylor.

Saudi gigaprojects gear up for $569bn of contract awards

Construction will also play a key role in helping the UAE and Saudi Arabia achieve their long-term economic aspirations.

“The UAE wants to be the leading country and economy in the world by 2071 and 10 per cent of that GDP is made up of the construction sector,” says Taylor.

“Saudi Arabia and the UAE are closely aligned in terms of their ambitions, and we believe we can play a significant role in achieving this.”

Watch: Saudi Arabia gigaprojects market outlook

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Colin Foreman

Exclusive from Meed

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Nakheel awards $259m Dubai Islands buildings contract
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Morocco plans second high-speed rail phase to Agadir
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Riyadh tenders King Salman Stadium works
26 October 2026

Saudi Arabia raises electricity tariffs
26 October 2026

Saudi Energy, formerly Saudi Electricity Company, has announced revised electricity tariffs, which will take effect on 1 January 2027.

The revised tariff schedule, published on the company’s official website, covers residential, commercial, industrial, agricultural, charitable and government customers.

The largest percentage increase in consumption rates is 16.7%, for residential customers using up to 6,000 kilowatt-hours (kWh) a month. Residential customers will pay 21 halalas/kWh for monthly consumption of up to 6,000kWh, up from 18 halalas. For consumption above 6,000kWh, the rate will rise from 30 to 33 halalas/kWh, a 10% increase.

The industrial tariff will increase by 15%, from 20 to 23 halalas/kWh. Commercial customers, private healthcare facilities and private educational facilities will pay 25 halalas/kWh, up from 22 halalas, for consumption up to 6,000kWh a month, and 35 halalas/kWh above that level, up from 32 halalas.

Tariffs for charities and government customers will also increase. In addition to consumption-based charges, customers will pay a fixed monthly fee based on the capacity of their electricity meter. This replaces the previous separate charge for meter reading, maintenance and billing, with VAT applied to the revised tariffs.

Electricity investment

The new tariffs coincide with changes to water consumption tariffs announced by the National Water Company, also effective from 1 January 2027.

King Salman Bin Abdulaziz Al-Saud directed support measures following a proposal presented by Crown Prince and Prime Minister Mohammed Bin Salman Bin Abdulaziz Al-Saud.

This includes raising the minimum wage required for Saudi nationals to count as full employees towards private sector localisation quotas under the Nitaqat programme.

The tariff changes come as Saudi Arabia plans substantial investment in its electricity infrastructure. In September 2025, Saudi Energy announced plans to invest SR220bn ($58.7bn) in power infrastructure projects between 2025 and 2030.

A June 2025 report by Fitch Ratings forecast negative free cash flow of about SR16bn a year over the period and rising leverage, reflecting the financial demands of the programme.

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Mark Dowdall
Dubai Municipality confirms AED3bn Tasreef drainage awards
26 October 2026

Dubai Municipality has confirmed it has awarded four contracts worth AED3bn ($817m) to expand the emirate’s stormwater drainage network by about 100 square kilometres under phase three of the Tasreef programme.

The projects will cover Jumeirah, Umm Suqeim, Al-Quoz, Al-Barsha, Al-Wasl and Al-Marmoom. The works include constructing and extending main stormwater drainage lines with diameters of up to three metres.

The four packages are part of Dubai’s AED30bn Tasreef programme, which aims to increase the emirate’s stormwater drainage capacity by 700% and reduce costs associated with pumping stations, network operations and maintenance by 20%.

The contracts have been awarded to China State Construction Engineering Corporation (CSCEC) and three local firms: Arifco Group, Nael Construction & Contracting (NCC) and Detech Contracting. Dubai Municipality did not state which projects the awards relate to.

According to sources, the contract awards include packages TF-15-C1, TF-15-C2 and TF-13-C1.

The first package, TF-15-C1, involves the construction of 21 kilometres of main and secondary drainage lines along Al-Wasl Road and in surrounding areas. It will cover Za’abeel 2, Al-Wasl, Jumeirah 1 and 2, Al-Bada’a, Al-Satwa and Dubai World Trade Centre. The estimated $100m contract was awarded to Detech in July, as exclusively reported by MEED.

The second package, TF-15-C2, covers the corridor between Sheikh Zayed Road and Al-Khail Road. It includes about 14km of main drainage lines serving Al-Quoz Industrial Areas 1, 3 and 4, and Al-Barsha 1. In July, MEED reported that CSCEC had won the engineering, procurement and construction contract for this project.

The third package, TF-13-C1, covers Al-Marmoom, where 23km of drainage infrastructure will be developed. According to a source, Arifco has been awarded this contract.

The final package covers Jumeirah and Umm Suqeim, where about 42km of main drainage lines will serve Umm Suqeim 1, 2 and 3; Umm Al-Sheif; Jumeirah 3; Al-Safa 1 and 2; and Al-Manara.

In May, MEED reported that NCC had been awarded a contract to build a sewage and stormwater drainage system, DS-204. However, it is unconfirmed whether this relates to the same project.

Earlier, in February, the municipality confirmed it had awarded contracts for five new projects under phase two of the programme to expand and strengthen Dubai’s stormwater drainage network.

These included two contracts awarded to Detech and one to CSCEC for stormwater drainage infrastructure. In addition, two consultancy contracts were awarded for the study and design of drainage systems in selected areas across the emirate.

Cumulatively valued at AED2.5bn, the new projects will serve 30 vital areas, spanning approximately 430 million square metres and supporting an estimated population of three million residents by 2040.

Previously, in April 2025, an earlier package of awards was announced under phase one of the Tasreef programme. The overall masterplan aims to expand Dubai’s rainwater drainage capacity by 700% by 2033.

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Nakheel awards $259m Dubai Islands buildings contract
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Dubai-based master developer Nakheel, part of Dubai Holding Real Estate, has awarded local firm Parkway International Contracting a construction contract valued at about AED950m ($259m) for phases two and four of Bay Grove Residences on Dubai Islands.

The package covers 617 residential units across eight buildings, ranging from one to four bedrooms, together with basement structures, infrastructure and community amenities including swimming pools, sports courts and fitness centres.

Phase two comprises 360 homes across four buildings, with main construction scheduled for completion in late 2028.

Phase four includes 257 homes across four buildings, with completion targeted for the second quarter of 2029.

The award follows an earlier contract valued at about AED800m ($218m) awarded to local contractor Metac General Contracting Company for phases one and three, covering 537 homes across seven buildings.

Together, the two contracts total more than AED1.75bn ($476m) and account for all 1,154 planned homes across the 15 buildings of Bay Grove Residences.

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Morocco plans second high-speed rail phase to Agadir
26 October 2026

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The pipeline forms part of the government’s 2026-31 programme, presented to parliament last week.

The Marrakech-Agadir link is estimated to cost close to MD55bn ($5.5bn) and will cover a 240-kilometre (km) route through the High Atlas Mountains via Chichaoua. Civil engineering structures, including tunnels and viaducts, are expected to account for nearly 70% of the alignment.

In September, the government issued a decree declaring the Marrakech-Agadir and Chichaoua-Essaouira rail corridors to be of public utility, paving the way for land acquisition and expropriation procedures.

Under the long-term masterplan Plan Rail Maroc 2040, Essaouira is expected to connect to the network via a separate line branching off at Chichaoua, designed for operating speeds of up to 200km an hour. The mainline to Agadir is designed for speeds of up to 320km/h.

The 2030-35 cycle also includes rehabilitating the Casablanca-Khouribga-Oued Zem line; constructing a new line between Oued Zem and Beni Mellal via Bejaad, with a branch to Fquih Ben Salah; doubling and upgrading the 140km Benguerir-Safi line; expanding capacity on the Fez-Oujda corridor; and building new-generation passenger stations.

The plans follow Morocco’s ongoing MD134bn ($13.4bn) 2024-30 rail investment programme, which focuses on completing the Kenitra-Marrakech high-speed line ahead of the 2030 Fifa World Cup.

The programme also includes developing regional express network services across five regions, electrifying the Fez-Oujda line and completing a freight rail link to the Nador West Med port.

Work on the Kenitra-Marrakech line had reached about 30% by May 2026, with commercial services targeted to begin in September 2029.

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Riyadh tenders King Salman Stadium works

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Saudi Arabia’s Sports Ministry has tendered a contract covering early works at King Salman International Stadium in Riyadh.

The scope includes enabling works, site preparation and initial construction activities.

The tender was issued on 11 October, with a submission deadline of 19 November.

The stadium will cover about 660,000 square metres (sq m) and seat 92,000. Facilities will include a 150-seat royal suite, 120 hospitality suites, 300 VIP seats and 2,200 dignitary seats.

The wider development will include sports facilities covering more than 360,000 sq m, including two training fields and fan zones; a closed sports hall; an Olympic-sized swimming pool; an athletics track; and outdoor courts for volleyball, basketball and padel.

The stadium is set to host the final of the 2034 Fifa World Cup and will serve as the Saudi national football team’s main base.

US-based architectural firm Populous is the lead architect for the stadium.

Construction of the stadium is expected to be completed by 2029.

The stadium will be located next to King Abdulaziz Park.

Firms submitted prequalification statements for the main design-and-build contract in February.

Saudi stadium plans

In August 2024, MEED reported that Saudi Arabia planned to build 11 new stadiums and refurbish four facilities for the 2034 Fifa World Cup.

Eight stadiums will be located in Riyadh, four in Jeddah and one each in Al-Khobar, Abha and Neom.

A further 10 cities will host training bases: Al-Baha, Jazan, Taif, Medina, Alula, Umluj, Tabuk, Hail, Al-Ahsa and Buraidah.

There are expected to be 134 training sites in the kingdom, including 61 existing facilities and 73 new venues.

Saudi Arabia was officially selected to host the 2034 Fifa World Cup during an online convention of Fifa member associations at the Fifa Congress on 11 December 2024.

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