Taylor Woodrow lands pounds 133m Russian rail deal

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Taylor Woodrow, the UK construction group, has won a contract to build a railway terminal complex in St Petersburg, the company's biggest contract in the former Soviet Union.

The $200m (pounds 133m) deal is part of a massive project for a high-speed rail line between the city and the Russian capital, Moscow, that will cost between pounds 3bn and pounds 5bn.

The railway line is one of Russia's largest infrastructure ventures and has huge symbolic significance because it unites the two historic cities with a non-stop service.

Sketchy details of the contract were announced by the public/private transport group, RAO-VSM, in Russia on Christmas Day. Taylor Woodrow was yesterday still unclear about aspects of the project.

No state finance is being provided, and RAO-VSM will not give the go- ahead for building work until negotiations with Western banks about fund- raising are completed next year. Taylor Woodrow, whose costs are being underwritten by the UK's Export Credit Guarantee Department, said there was no question of starting work before the finances were agreed.

When the rail line is finished it will mean that the 645km journey, often involving an overnight trip, will be cut to 2.5 hours, offering travelling times normally associated with Japanese high-speed links.

Taylor Woodrow is teaming up with a Finnish construction company, Skanska Oy, to build the terminal in the centre of St Petersburg, which will include a hotel, shops and offices. The complex is understood to have been designed by Hok International, the London architects. A further 10 rail stations are to be built along the route, though contracts have not been placed, as large-scale works to clear explosives left from World War II have to be carried out before construction can start.

It is hoped that by upgrading and standardising Russian rail lines they will eventually be linked to the expanding west European rail services.

Taylor Woodrow has been operating in Russia for about 10 years, and is regarded by the Moscow authorities as one of the most highly-rated Western construction firms doing business in the country. Current projects include building and refurbishing a cigarette factory for BAT, and it has built two fast-food Pizza Hut restaurants in Moscow.

The company said that it had never experienced any problems with corruption.