Balfour Beatty agrees £0.8bn sale of Parsons Brinckerhoff
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Balfour Beatty has agreed to sell Parsons Brinckerhoff, its US business, to Canadian industrial group WSP Global for US$1.35bn cash (£0.8bn).
The FTSE 250 group, which needs the approval of shareholders and antitrust authorities to complete the sale, said it would return up to £200m to shareholders, cut its pension fund deficit by £85m and retain the rest.
Balfour Beatty's insistence on selling the US professional services division was one of a number of sticking points that saw it reject a recent merger proposal from rival Carillion.
"The board believes that the sale price of £820m delivers both a significant return on our original investment and a compelling level of value creation for shareholders - which remains the key focus of the board," said executive chairman Steve Marshall.
The disposal, which will be subject to £80m of transaction taxes, fees and other transactional costs plus certain "separation-related costs", is expected to complete in the fourth quarter of the current calendar year.
Following the sale and the recent 46% upward revaluation of its public-private partnership portfolio, management see the group's key strategic priorities as: restoring the value of the UK construction business, especially improving margins; building on the performance of the investments and services businesses; leveraging growth opportunities in US buildings, US civils, rail and power, and its Far East and Middle East joint ventures; cutting further costs and improving efficiency; and assessing further value creation opportunities.
Marshall added that the group was well placed for an "incoming group CEO to take the company forward".
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