CCCC group’s Tuas viaduct double tests local contractors’ hold on LTA work

Illustration of three contract folders on a site-office table, two of them clipped together, with concrete viaduct piers rising over an industrial road outside the window.

On paper, the Land Transport Authority has spread the Tuas Road Viaduct extension across three contractors. When you judge this by parent company, there are only two winners, with the larger share sitting with China Communications Construction Company. For Singapore’s own main contractors, the question is how much LTA civil work they can keep when a large job is cut into packages of similar size and one state-owned group can win more than one of them through separate entities.

LTA announced on 30 September three civil contracts worth a combined S$1.2 billion for the second phase of the viaduct. Construction will start in early 2027 and last until 2032. Singapore company Hwa Seng Builder won the Pioneer Road Viaduct contract, valued at S$381.6 million.

The Singapore branch of CCCC, a state-owned China-based construction firm with dual listings in Shanghai and Hong Kong, took the S$430.3 million Tuas South Avenue 3 Viaduct contract. China Harbour (Singapore) Engineering Company won the S$404.4 million Tuas South Boulevard Viaduct contract. It is a subsidiary of state-owned China Harbour Engineering Company, which is itself a unit of CCCC.

Two port legs, one parent

LTA cut the job by geography, and the extension will connect to Tuas Port via Tuas South Avenue 3 and Tuas South Boulevard, and to the city via Pioneer Road. Both port-facing legs went to the CCCC group, while the local winner holds the city-facing section, which is also the smallest of the three contracts by value.

Packaging of this kind widens the field. Three mid-sized contracts let firms bid without taking on a single S$1.2 billion risk, which should suit local contractors. It also lets a group with several Singapore-registered entities compete for more than one package without any one entity stretching its balance sheet or its site teams. With adjacent sections under one parent, the CCCC group can share plant, temporary works and supervision across both port legs, an advantage a local firm holding one package cannot match.

How LTA reached its decision is less clear. It has not disclosed the number of bidders for each package, the tender prices or how it weighted price against quality, so nobody outside the process can yet say whether the CCCC entities won on price, on technical scoring or on both. LTA said only that all three contractors have established track records in delivering major transport and civil engineering infrastructure projects in Singapore. Until the tender results are published, the line about three companies overstates how widely the work has been spread.

Aerial view of high-rise towers, a shopping complex and green parks in a large city.

Jurong Region Line teams head for Tuas

The three firms’ current workloads overlap heavily. Hwa Seng Builder is building Loyang Viaduct and three stations on the Jurong Region Line, and earlier worked on the viaduct from the TPE to the PIE and Upper Changi Road East and on the expansion of the KPE and TPE interchange. CCCC’s Singapore branch is building Boon Lay station and viaduct works on the Jurong Region Line, as well as viaduct and tunnel works for the Johor Bahru–Singapore Rapid Transit System Link and the Jurong East Integrated Transport Hub. China Harbour (Singapore) is building two stations on the Jurong Region Line.

On road-viaduct experience alone, Hwa Seng’s record is the closest match to the Tuas job, yet it took the smallest package. The CCCC group offers breadth instead: rail, cross-border transit and an integrated hub, delivered through two entities that can each carry a separate contract. A specialist record earns a local firm a place on LTA’s award list but does not guarantee it the larger packages. All three already have teams on the Jurong Region Line, which should keep their mobilisation costs at Tuas down and make the next round of western civil tenders just as competitive.

The works comprise new road viaducts, associated road improvements, drainage enhancements and supporting infrastructure. For suppliers, that means foundations and piers come first, then deck spans, then drainage and road works once the structure is up. LTA has not said whether the contracts are design-and-build or construct-only, nor whether the decks will be precast concrete or structural steel. Those choices decide which trades take the larger share of the subcontract value.

Concentration at parent level shapes this downstream market. Two CCCC entities on neighbouring sections can pool their buying, so local precasters, steel fabricators and piling specialists may face one procurement decision for two of the three packages. Whether the group buys through Singapore supply chains or its own will be the first test of how much of the contract value stays with local subcontractors.

The sites add work of their own. Traffic realignments and lane closures on Tuas South Avenue 3, Tuas South Boulevard and Pioneer Road will be implemented progressively, and LTA’s measures may include temporary bus stop shelters and footpaths. That is steady business for traffic management and temporary works firms, and a cost for logistics operators in Tuas South, who will have to work around live sites for several years. The payoff is a corridor that bypasses 18 surface-level junctions.

A port-driven job in a cooling market

LTA said the extension will support industrial developments in Tuas South and the consolidation of Singapore’s container port activities at Tuas over the next decade. It expects the works to be completed in phases starting in 2032. A phased handover means contractors will release sections while the port consolidation is still under way, so the job is timed to the port rather than to the construction cycle.

That cycle is turning. The Building and Construction Authority, which forecasts national construction demand, expects demand to hold at S$47–53 billion in nominal terms in 2026, then average between S$39 billion and S$46 billion a year from 2027 to 2030. It has also warned that demand could moderate after the one-off Changi T5 project, potentially reverting to pre-Covid levels. The Tuas contracts therefore lock in work for three firms through a period when the wider market is forecast to shrink, and the firms that missed out will be chasing a smaller pool.

The largest risk for local contractors is that Tuas becomes the template: big LTA civil jobs split into packages of similar size, with a well-resourced state-owned group able to take more than one through its Singapore entities. Published tender results would show whether the outcome came from lower prices or better technical scores, and each answer points local firms in a different direction, towards sharper pricing or towards joint bids that match the group’s scale.

Contract form is the other variable. BCA has been promoting collaborative contracting through more than 20 ongoing and upcoming pilot projects, and in the public sector this takes the form of Option Module clauses under the Public Sector Standard of Conditions of Contract. If LTA uses such terms at Tuas, risk and early coordination would be pushed further down the chain, which favours firms with dependable supply chains.

Hafary buyout returns tile distributor to founders as Hap Seng cuts debt

Illustration of a ring of keys on a stack of ceramic tile samples on a showroom counter beside a signed sale agreement, with tile shelves behind.

By accepting a cash offer of S$0.64 per share for its 50.82 per cent stake in Hafary Holdings, Malaysian building-materials group Hap Seng Consolidated claims it now has cash ‘at an attractive valuation’ and a stronger financial position. The buyer is 23 Capital, a vehicle owned by the Hafary founding family, so the business passes back to the people who run it rather than to a rival consolidator.

Hap Seng has earmarked the proceeds of the sale, put at about S$140 million, or 447 million Malaysian ringgit (about $110 million), for partial repayment of borrowings that totalled 6.9 billion ringgit at the end of 2025. It expects a gross gain of about 187.3 million ringgit, with completion before the year ends. Hafary will cease to be a subsidiary, so the 48.4 million ringgit it contributed to Hap Seng’s profit and the 19.85 million ringgit in dividends will stop flowing.

Hap Seng is giving up a steady earner to ease a large debt pile, and the debt-repayment plan may limit its negotiating leverage compared with a seller choosing its moment. The sale also closes the logic of 2015, when Hap Seng bought in as a stepping stone to expand in the region. It was then mainly upstream in building materials while Hafary was strong downstream.

Hafary chief executive Low Kok Ann controls 23 Capital with his son Low See Ching and daughter Low Bee Lan. He started the business from a single ceramic tile shop in 1980. A founder-led buyer is already inside the channel, so it has no overlapping business to rationalise and no synergy target to justify with tougher supplier terms, as a trade buyer might.

The more probable change is in who pays for growth. Hafary manufactures and trades tiles, stone, mosaic, wood-flooring, quartz tops and sanitary ware, a broad range to fund. The regional expansion that Hap Seng’s 2015 purchase was meant to support now rests on the family’s own capital and bank lines, and neither side has said whether it will continue.

Hap Seng says the price is above market and historical trading prices and at a premium to its initial cost of S$0.24 per share. It has not given the margin, nor Hafary’s earnings, net assets or share count, so the offer cannot yet be set against peer distributors. The remaining shareholders must judge whether that is enough.

Singapore’s Building and Construction Authority projects construction demand of S$47–53 billion in 2026, similar to 2025, when preliminary actual demand reached S$50.5 billion. It expects an average of between S$39 billion and S$46 billion a year from 2027 to 2030, and says demand could moderate after the one-off Changi T5 development, potentially reverting to pre-COVID levels.

For a distributor serving projects, a lower base from 2027 is the largest risk. Hap Seng banks cash before it arrives, while the family takes it on without a public parent. Delisting may make patient, counter-cyclical investment easier to defend, but it also removes a listed currency for acquisitions, and Hafary’s split between project and retail customers will decide how exposed it is.

Four things will show the deal’s real shape: the premium and whether minority shareholders accept, Hafary’s revenue split between project and retail buyers, any change in payment terms for suppliers and any investment or regional plan from the family. Contractors and suppliers should seek clarity on credit and pricing terms before relying on current arrangements. The founders’ willingness to buy suggests they value Hafary above what the listing gave it, and the published premium will show by how much.