Latest Rail News

25.07.14

Balfour Beatty and Carillion confirm merger talks

Balfour Beatty and Carillion have confirmed that the two construction giants are engaged in ‘preliminary discussions’ with regards to a possible merger.

Although the companies would not confirm how much the merger is likely to cost, it has been speculated that a £3bn construction and services company could be created.

What the firms did say was that the “the boards of Carillion and Balfour Beatty believe that the merger of the two groups has the potential to create a market leading services, investments, and construction business of considerable depth and scale”.

In addition, the two parties have agreed that Balfour Beatty’s publicly announced sale process of its professional services division Parsons Brinckerhoff, which is already underway, will proceed unaffected by this announcement, subject to achieving acceptable value and terms.

Work is now underway to develop a strategy and outline business plan for a combined entity, underpinned by the “evaluation of achievable synergies, future financing arrangements and a number of other essential supporting workstreams”.

A decision will be required no later than 21 August 2014, to either announce a firm intention to undertake, or not, a transaction in accordance with Rule 2.7 of the Code each of Carillion and Balfour Beatty.

Photo shows Balfour Beatty/Carillion JV contractors on-site at Shoreditch during East London Line works in 2008. Copyright Adambro (Creative Commons)

Tell us what you think – have your say below or email opinion@railtechnologymagazine.com

Comments

Darren   25/07/2014 at 14:29

Could spell bad news for sub contractors. Balfour are one of the decent major contractors out there, Carrilion are the worst FACT

Paul   26/07/2014 at 18:07

Well between them they have sucked in and destroyed some of the best contractors in the country, if they join together they might destroy each other and I for one would lose not one wink of sleep over it. However what is more likely is that together they will just ride roughshod over the entire industry and leave sub-contractors empty and broken in their wake. Bad times.

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