Balfour Beatty has responded to the approach that John Laing Infrastructure Fund made for Balfour Beatty’s infrastructure assets. Balfour says the mooted £1bn price tag undervalues these assets – the Board “concluded that the proposal falls significantly short of its own view of the value of the portfolio” and therefore it has rejected the proposal. The valuation of these assets in Balfour Beatty’s accounts at the end of June was £1.05bn so it is easy to see where JLEN’s £1bn offer came from. However the Balfour Board think that they’ll get more money by selling off these assets piecemeal as each investment matures and cite the recent experience of selling one asset at a 28% premium to valuation.this rather begs the question as to whether the June valuation was wrong and Balfour answer this by saying they’ll produce an updated valuation in January 2015. The Board also speculate that there are synergies to having this division within the Balfour Beatty Group that make the group as a whole more valuable.
JLIF : Balfour Beatty rejects JLIF approach