John Laing fund makes 1 billion pound bid for Balfour Beatty PPP assets

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John Laing fund makes 1 billion pound bid for Balfour Beatty PPP assets

John Laing Infrastructure Fund has made a £1 billion (US$1.57 billion) offer for the PPP assets of the UK-based infrastructure group Balfour Beatty Plc.

The non-binding offer values the assets at more than three quarters of the market capitalisation of Balfour Beatty, which has boosted the firm's shares.

The portfolio includes about 60 private finance initiative and PPP contracts.

Balfour Beatty Plc said it will review the proposal once received from John Laing Infrastructure Fund.

The offer comes after the publication, in August 2014, of the Balfour Beatty's review of the Directors' Valuation of the PPP Portfolio. The review resulted in an increase in the total Directors' Valuation to £1,051 million as at June 2014. This represented a 46% increase to the total portfolio valuation as at June 2014.

The revaluation exercise was undertaken across the UK and North America portfolio of assets. The UK portfolio valuation increased to £801 million at June 2014, compared to £491 million at June 2014 under the previous valuation methodology, representing a 63% increase. The North America portfolio valuation increased to £250 million at June 2014, compared to £230 million under the previous valuation methodology, representing a 9% increase.

Balfour Beatty has recently rejected an approach from British integrated support services company Carillion Plc for a £3 billion (US$4.7 billion) merger.

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