Raubex gets big Sanral contracts

JSE-listed construction group Raubex has been awarded two major contracts by the SA National Roads Agency (Sanral), together valued at R2.87 billion – providing further evidence that President Cyril Ramaphosa’s massive infrastructure investment drive to stimulate the economy post Covid-19 is starting to happen.

Raubex CEO Rudolf Fourie said on Tuesday both contract awards relate to projects that were among the 50 strategic infrastructure projects (SIPs) gazetted by the government.

“It looks like Sanral is back strongly,” he said. “We are over the moon. We have never had so much work.”

Fourie said Raubex has now been awarded three SIPs and the latest contract awards by Sanral have increased the company’s secured order book to R14.23 billion.

Raubex reported last month that its Sanral order book was at a record high of R3.26 billion after dropping to only R207.6 million in February 2019.

This followed Raubex reporting earlier this month it had been awarded a R1.48 billion contract for the upgrade of the N3 from Dardanelles to Lynnfield Park as well as some smaller contracts by Sanral.

Latest awards are for the upgrading of:

• National Route 2 from KwaMashu Interchange, Section 25 (28.6km) to Umdloti River Bridge, Section 26 (14.0km) for R1.43 billion, which has a contract period of 40 months.
• National Route 3, Section 2, from Cato Ridge (20.2km) to Dardanelles (26.6km) for R1.44 billion, which has a contract period of 51 months.

These awards follow Sanral announcing in August that it was ready to implement R30 billion worth of construction projects.

Fourie said there are still quite a few other tenders Sanral has to award, including one big project on the N3 where Raubex was not the lowest bidder.

Fourie estimates that Sanral has now awarded between R12 billion and R14 billion of the R30 billion of construction projects it indicated it was ready to implement.

“We are still waiting for quite a few smaller project awards. I guess there are probably about R3 billion [worth] of quite a number of contracts that we still could be in the running for. But this is now all the big bids that we submitted which we were in
the running for,” said Fourie.

However, he said Sanral last week advertised two large Wild Coast road projects contracts and there is still the project to upgrade the EB Cloete Interchange on the N3 near Durban.

WBHO Group CEO Wolfgang Neff confirmed on Tuesday the company was awarded a contract by Sanral for the improvement on National Route N2 Sections 14 and 15 from Green River to the Buffalo River Bridge valued at between R450 million and R500 million.

“That is the only [Sanral] contract we have been awarded to date, but we priced probably R20 billion worth of work for Sanral in the last 12 months,” said Neff.

“A lot of the contracts remain unawarded. But they have started to award contracts and Raubex has been fortunate to get one or two,” he said.

This article first appeared on Moneyweb and was republished with permission.

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