Member Article

Balfour Beatty sells Parsons Brinckerhoff to USA firm for $1.35 billion

Construction group Balfour Beatty has announced the sale of its Newcastle-based professional services division, Parsons Brinckerhoff, to WSP Global inc for $1.35 million (£820 million).

The sale of Parsons Brinckerhoff has caused ructions during the potential merger between Balfour Beatty and national infrastructure group Carillion.

The merger was terminated by Balfour Beatty in July and, despite several repeat attempts by Carillion, talks came to an end last month.

Following the deduction of necessary fees and transaction costs, shareholders will receive £200 million of cash proceeds with another £85 million going towards the deduction of the group’s pension fund deficit.

Balfour Beatty is now turning its attention to the restoring value of the UK construction market, returning it to peer group margins.

The group is also looking to explore the growth opportunities in the US and worldwide.

Steve Marshall, executive chairman of Balfour Beatty said: “The Board believes that the sale price of £820 million 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.

“The sale of Parsons Brinckerhoff follows the recent revaluation of our investments portfolio, which underlines the potential of this division to create value internally and across the Group. In the US, our core construction business is well positioned in a recovering market. In the UK we see the potential for margins to progressively recover to peer group levels. Our services business, meanwhile, is well placed to benefit from the growing investment in infrastructure. Together, these elements will provide a strong foundation for an incoming Group CEO to take the company forward.”

This was posted in Bdaily's Members' News section by Ellen Forster .