UPDATE 1-Bilfinger Berger banks on takeovers for profit growth
* 2016 net profit margin target 3.3 pct vs 2.6 pct in 2011
* Has over 1 billion euros available for buys
* Takeovers planned in Asia, for Industrial & Services units
* Shares down 0.6 pct, MDAX up 0.2 pct (Adds CEO comments, details on takeovers)
By Peter Dinkloh
MANNHEIM, March 21 (Reuters) - Bilfinger Berger, Germany's second-largest building company, is banking on takeovers in Asia away from its traditional construction business to reach its 2016 earnings goal, it said on Wednesday.
The company, based in the southern German city of Mannheim, said it aims to increase its profitability, measured as adjusted net income as a percentage of output, to at least 3.3 percent in 2016 from 2.6 percent in 2011.
Bilfinger is in the last steps of transforming itself from a construction company to a provider of services to utilities, engineering companies and governments.
The company has "significantly" more than 1 billion euros ($1.3 billion) available for acquisitions and plans to spend a "considerable" portion of this amount this year and next, it said in its annual report published on Wednesday.
"If we look at our acquisitions list it's very clear that the Asian window will play a role," Chief Executive Roland Koch said.
The company bought Neo Structo, a services provider to the process industry in India, for an undisclosed amount last year.
Koch, the former head of Hesse's state government, started his tenure at Bilfinger last year by promising higher profitability as he set the target to double net profit to 400 million euros and raise output by half by 2016.
Output comprises a company's own sales plus revenues from its partners which have a minority stake in construction projects.
The company's construction business will reach its targeted volume of 1.5 billion euros in annual output next year and consequently the focus for takeovers will be for its Industrial Services and its Power Services units, it said.
Shares were down 0.6 percent at 72.87 euros at 1551 GMT, while the midcap index MDAX was 0.2 percent higher.
The company's shares have risen 26 percent over the past 12 months, giving the company a stock market value of 3.4 billion euros, according to Thomson Reuters data.
Bilfinger, which traces its roots back to a construction project in 1880, is valued at 12.6 times expected earnings per share in the coming 12 months, a 3 percent premium to peers including Vinci, according to Thomson Reuters StarMine. ($1=0.7552 euros) (Editing by Mike Nesbit)
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