Balfour Beatty divests again

Balfour Beatty has completed a third partial sale of its original 40% stake in Connect Plus – the company that operates the M25 orbital motorway around London in the UK.

This follows two earlier partial sales of its stake in the company in December 2017. First, Balfour Beatty sold a 12.5% stake for a cash consideration of £103 million (€116.7 million). This was closely followed by the sale of a further 7.5% stake for £62 million (€70.3 million) – on both occasions to funds managed by Dalmore.

The latest sale of the 5% stake was to funds managed by Equitix for a cash consideration of £42 million (€47.6 million). This is equivalent to the price of the earlier transactions, which was in excess of the directors’ valuation as at 30 June 2017.

Also, Equitix has exercised its option on the previous 7.5% partial sale so that the total 25% sell down is split equally between Equitix and Dalmore.

The expected profit on disposal for the latest transaction is £22 million (€24.9 million), and it was said that the proceeds would be used to pay down borrowings in 2018.

In total, Balfour Beatty has now sold 25% of its original 40% holding for a total cash consideration of £207 million (€234.6 million). The group continues to own a 15% stake in Connect Plus.