Thursday, Jan 07, 2010
TOKYO (Nikkei)--A consortium of four Japanese general contractors and one Turkish firm will suspend construction of the Dubai Metro as early as Thursday, citing the delay in payment from the Dubai government, the Nikkei reported in its Thursday evening edition.
The rail system was partially opened this past fall. Its full completion, originally slated for this spring, is now expected to be pushed back until the end of the year for a number of reasons, including design changes.
The consortium members--including Obayashi Corp. (1802.TO), Mitsubishi Heavy Industries Ltd. (7011.TO), Mitsubishi Corp. (8058.TO) and Kajima Corp. (1812.TO)--have decided to halt work for the time being, placing priority on talks with the Dubai government to secure back payments.
The consortium received roughly Y490 billion worth of orders to build the metro from Dubai's Roads & Transport Authority, with the work starting in 2005. But the actual construction expenses are expected to total almost twice as much.
As of the end of October, the consortium's accounts receivables were estimated at more than $5.2 billion (about Y480 billion).
(END) Dow Jones Newswires
07-01-10 0516GMT
