Fletcher Building (ASX:FBU) has announced a binding agreement to sell its construction division to global construction giant VINCI Construction for $315.6 million.
The price could rise by up to $18.5 million, depending on the outcome of several key contracts, bringing the potential total value to $334.1 million.
Fletcher Building CEO Andrew Reding said the sale reflects the company's strategic focus on building products manufacturing and distribution, while simplifying its portfolio, reducing debt, and enhancing shareholder returns.
"Fletcher Construction is a great business with a proud legacy, and VINCI is well-positioned to be a strong long-term owner," Reding added.
The transaction covers Fletcher Construction Holdings and its three New Zealand business units: Higgins, Brian Perry Civil, and Fletcher Construction Major Projects.
South Pacific operations and residual responsibilities for completed legacy projects, including the New Zealand International Convention Centre, are excluded.
Regulatory approvals, key contract consents, and restructuring of South Pacific operations are expected to be completed by the first quarter of FY27, with full transaction completion anticipated before the end of 2026.
Approximately 2,300 employees will transfer to VINCI, ensuring continuity for customers and ongoing projects.