Reversing a model that Enron tested unsuccessfully during the 1990s tech boom,
, the US telecommunications firm, is betting on the energy infrastructure business to drive profits.
The Florida company, which had US$1.6bn (Dh5.87bn) of revenue last year, has spent about
$330 million in the past two years acquiring wind-farm and gas-pipeline construction businesses.
"A lot of the businesses we have entered in the last few years have historically had better margin profiles than the businesses that we have been involved with for a long time," Jose Mas, the chief executive of MasTec,
.
"We suspect somewhere between 8,000 to 10,000 megawatts of wind [infrastructure] construction will get done in 2010 and our target is to do somewhere between 1,300mw to 1,400mw of that," he said.
"We are seeing a lot of pipelines that will be constructed in 2010 and 2011," Mr Mas added.
Mr Mas had better hope that the winds of change are kinder to MasTec than the hi-tech revolution was to Enron, the defunct Houston energy company that went bankrupt in 2001 amid disclosures that it had cooked its books
Enron started out in the 1930s as a builder and operator of gas pipelines. At the time, that was a stable, low-margin business in the US, where natural gas prices and tariffs for transporting gas were regulated until the mid-1990s.
Seeking higher profit margins during that decade, Enron branched into new businesses including energy trading and broadband communications. It launched Enron Online in 1999.
Only time will tell if the widely forecast clean energy boom will help MasTec succeed in marrying energy and communications businesses where Enron conspicuously failed. At present, Mas Tec still derives more than half its revenue from communications customers, including wireless and cable television firms.
The company made its debut in pipeline construction last November with the $132m purchase of
. It
k, a wind-farm construction company, for $200m in 2008.
MasTec is betting that the $6bn allocation for clean energy technologies in the 2011 US budget will boost renewable energy businesses such as wind and solar, as well as stimulating demand for gas-fueled power generation to complement intermittent electricity sources.
