The planned acquisition of major builder Probuild by state-owned China State Construction Engineering Corp has fallen over.Credit:Josh Robenstone
The deal required the approval of both the Treasurer and the Foreign Investment Review Board.
South African company Wilson Bayly Holmes-Ovcon (WBHO) confirmed late on Monday the proposed sale of its 88 per cent stake in Australian-based Probuild would not proceed on national security grounds.
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"The company in June last year received the indicative proposal from a major international construction company to acquire the Probuild shareholding,but the buyer has advised that the deal would be rejected by the relevant federal government on the grounds of national security,"WBHO said.
"This[is] despite all other due diligence having been completed and commercial terms having been materially agreed between the parties."
Government and industry sources confirmed the Treasurer had contacted both parties late last year to inform them he would not be approving the deal.
The decision was based on concerns about a Chinese government controlled conglomerate holding contracts with government agencies and critical infrastructure service providers,they said.