John Laing makes £1bn bid for Balfour Beatty assets

Balfour_BeattyJohn Laing Infrastructure Fund has made a £1 billion offer for the public-private partnership assets of Balfour Beatty, highlighting the attraction of work on schools and hospitals for private sector firms.

The non-binding offer equates to more than three quarters of the market capitalisation of Balfour Beatty, which also has construction and support services businesses, and boosted Balfour’s shares on Monday to their highest since September.

John Laing said that it has offered approximately £1bn in cash for the assets, which constitute around two-thirds of Balfour Beatty’s total value.

In August, Balfour increased the valuation of its PPP portfolio by 46 per cent to £1.05bn pounds, in part reflecting Britain’s economic recovery.

Balfour Beatty said that it will “review the proposal once received from John Laing Infrastructure Fund (JLIF)”.

However the company stressed “the board remains open to value creation opportunities across the group while it concentrates on the restoration of value to its shareholders”.

The offer from JLIF, the FTSE 250-listed infrastructure funds, comes after a troubled couple of years for Balfour, during which it has issued a string of profit warnings and fended off takeover approaches from rival Carillion.

Balfour has appointed turnaround specialist Leo Quinn from defence firm Qinetiq as its new chief executive, tasked with leading a strategic review of the group when he joins on Jan. 1.

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