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Kenneth Ko

HONG Kong contractor Tak Son Engineering has set up a joint venture in Guangzhou to tap the huge market for building work in China.

  Director David Lai said Tak Son had a 60 per cent stake in the venture, while Guangzhou No.2 Construction Co owned the remaining 40 per cent.

  He said the joint venture had a co-operation period of 15 years, with a general licence to undertake various building contracts on the mainland.

  Mr Lai said Tak Son was interested in exploring the China market which had tremendous potential for growth because of the massive property and infrastructure developments in the pipeline.

  ''The profit margin for building works in China is higher than that in Hong Kong,'' he said.

  It was estimated that the margin for contracts in China could be as high as 10 per cent, compared with about three per cent in Hong Kong currently.

  Mr Lai said Tak Son aimed to secure contracts from overseas and Hong Kong developers engaged in property projects in China.

  The group is already preparing tenders in response to invitations for mainland contracts from Evergo International, World International, New World Development and Tian An China.

  Mr Lai said the tight credit policy in China should not adversely affect the projects of Hong Kong companies, as their capital was not from the mainland.

  He said Tak Son wanted primarily to secure building works relating to high-rise offices, hotels and residential developments.

  Tak Son, established in 1972 by Tang Kar-hung and his wife, is an active player in the private-sector contracting business in Hong Kong.

  The group is believed to be seeking a listing on the Hong Kong stock exchange.

  Currently, it has about $1.2 billion worth of contracts on hand, including the building works for Kingswood Villas, a Cheung Kong residential project in Tin Shui Wai.

  Cheung Kong, one of the biggest developers in the territory, has been a major client of Tak Son for a long period.

  Mr Lai said more than half of Tak Son's contracts were building works for Cheung Kong projects.

   Other Cheung Kong projects previously contracted by Tak Son included Laguna City in Cha Kwo Ling, and Birchwood Place and Robinson Heights in the Mid-Levels, he said.

  Tak Son recently submitted a bid for the contract for World International's property development in Tai Wai, Sha Tin.

     Lai Sun Development is another major client of the company.



Tak Son Engineering targets Guangzhou work