International infrastructure firm Balfour Beatty has announced a third partial sale of its stake in Connect Plus.
The expected profit on this particular transaction, which will see a further 5% stake sold in the organisation that is responsible for operating the M25 orbital motorway, will pay down borrowings for this year.
Balfour Beatty confirmed this sale is for a cash consideration of £42 million, which is more than the valuation set by the Directors at the end of June 2017.
It is quite a shift in policy for the company; at the start of December, Balfour Beatty had a 40% stake in Connect Plus – which is a consortium that consists of Balfour Beatty, Egis Road Operation UK and Edge Orbital Holdings Ltd. These organisations work together to deliver highways asset care from finance and design, to build and maintenance, along with day-to-day operation.
However, at the end of last year, Balfour Beatty announced two partial sales of its stake in Connect Plus: the first was for 12.5% of its sake, worth £103 million, and the second saw a further 7.5% of the stake relinquished for a cash consideration of £62 million – again, higher than the initial valuations made by company Directors last June.
Now, with the sale of a further 5%, it means Balfour Beatty has sold 25% of its original 40% holding, for a total cash consideration of £207 million.
The Group confirmed that the latest 5% was sold to funds managed by Equitix Investment Management Ltd (Equitix), who has also exercised an option on the 7.5% partial sale, meaning that the 25% sold by Balfour Beatty has been split evenly by Dalmore Capital Ltd and Equitix.
The Chief Executive of Balfour Beatty, Leo Quinn, said the partial sale of its Connect Plus stake reflects the Group’s intent to its shareholders.
He 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.”
Balfour Beatty still owns 15% of Connect Plus.