Balfour Beatty announces third partial sale of M25 infrastructure asset
19 February 2018
Further to the announcements on 21 and 29 December 2017, Balfour Beatty announces the sale of an additional 5 percent stake in Connect Plus, the company which operates the M25 orbital motorway.
The sale is for a cash consideration of £42 million, equivalent to the price of the earlier transactions, which is in excess of the Directors’ valuation as at 30 June 2017. The expected profit on disposal on this transaction is £22 million. The proceeds from this transaction will be used to pay down borrowings in 2018.
In total, Balfour Beatty has now sold 25 percent of its original 40 percent holding for a total cash consideration of £207 million. The Group continues to own a 15 percent stake in Connect Plus.
The Group has sold the 5 percent stake to funds managed by Equitix Investment Management Limited (Equitix). Further, Equitix exercised its option on the previous 7.5% partial sale so that the total 25 percent sell down is split equally between Equitix and Dalmore Capital Limited (Dalmore).
For the year ended 31 December 2016, Investments in Joint Venture & Associates in relation to the Group’s 5 percent interest in Connect Plus was £31million1 and it contributed profit before tax of £3 million to the Group’s results.
Leo Quinn, Group Chief Executive, said: “This transaction again demonstrates the ongoing attractiveness of our infrastructure assets and is in line with our declared intent to maximise value for shareholders.”
1The Investment in Joint Ventures and Associates at 31 December 2016 reflects the net position after financial asset and swap liability revaluations. These revaluations will be recycled to the income statement as part of the gain on disposal of the Group’s interest in Connect Plus.
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Notes to editors:
- Balfour Beatty (www.balfourbeatty.com) is a leading international infrastructure group. With 30,000 employees, we provide innovative and efficient infrastructure that underpins our daily lives, supports communities and enables economic growth. We finance, develop, build and maintain complex infrastructure such as transportation, power and utility systems, social and commercial buildings.
- Our main geographies are the UK and Ireland, US and Far East. Over the last 100 years we have created iconic buildings and infrastructure all over the world including the London Olympics’ Aquatic Centre, Hong Kong’s first Zero Carbon building, the National Museum of the Marine Corps in the US and the Channel Tunnel Rail Link.
- The shareholders of Connect Plus following the sale of 12.5 percent to funds managed by Dalmore and 12.5 percent to funds managed by Equitix will be:
- 40% - BBDE Orbital Holdings LLP (comprising Balfour Beatty Infrastructure Investments Limited (BBIIL)37.5%, funds managed by Dalmore 31.25%, funds managed by Equitix 31.25%)
- 40% - EDGE Orbital Holdings Limited
- 10% - EDGE Orbital Holdings 2 Limited
- 10% - Egis Investment Partners S.C.A