Durability + Design
 
About  |  Subscribe  |  Advertise  |  Connect 
Follow us on Twitter Like us on Facebook

 

Download our FREE e-book! Advances in Architectural Coatings Technology

D+D News

Main News Page


Construction Mega-Merger Runs Aground

Friday, August 8, 2014

More items for Good Technical Practice

Comment | More

The ink was barely dry on a $5 billion proposal to merge two global construction giants when one called the deal off.

Balfour Beatty shut down merger talks with rival Carillion one week after announcing the £3 billion ($5 billion USD) deal, citing disagreement over the terms.

The UK-based companies jointly announced the merger July 24, saying the deal "has the potential to create a market-leading services, investments, and construction business of considerable depth and scale."

A week later, however, Balfour Beatty abruptly announced that it was pulling the plug on the talks.

The sticking point: Carillion's "wholly unexpected decision to only progress the possible merger in the event that Parsons Brinckerhoff remained part of the potential combined entity."

Balfour Beatty
balfourbeatty.com

UK-based construction giant Balfour Beatty has terminated merger talks with Carillion only one week after announcing the possible £3 billion ($5 billion USD) deal.

Parsons Brinckerhoff is a U.S.-based engineering and design consultancy; since 2009, the New York-based multinational has been Balfour Beatty's professional services division. Balfour Beatty announced previously that it planned to sell Parsons.

Founded in 1909, London-based Balfour Beatty provides construction, engineering and facilities management services in over 80 countries.

Wolverhampton, UK-based Carillion was formed in 1999 when the Tarmac Group divested its support services and construction businesses. The company's integrated support services include construction services, facilities management and public private partnership project investments.

Satisfying Merger Requirements

Carillion said that its board had concluded that for the merger to satisfy its requirements, "it would be essential to retain the stability and dependability of Parsons Brinckerhoff's earnings."

Balfour Beatty said that change is "contrary to the basis upon which the Balfour Beatty Board agreed to engage in preliminary discussions."

Balfour Beatty announced May 6 that a strategic review had led it to evaluate options for selling Parsons Brinckerhoff, which it acquired in 2009 for $600 million. At the same time, the company also announced that CEO Andrew McNaughton had stepped down, effective immediately.

Reports say Balfour Beatty needs the sale to short up its finances.

Carillion 'Surprised' by Reaction

Additionally, Balfour Beatty said Carillion's desire to retain Parsons Brinckerhoff contrasts with a joint announcement on July 24 that confirmed the sale of Parsons Brinckerhoff would be unaffected by the merger discussions, as well as a presentation Carillion made July 28 to the Balfour Beatty board.

Carillion
Flickr.com / Carillion

Carillion's Board said the merger requirements would count on Balfour Beatty retaining Parsons Brinckerhoff instead of selling it as the company has planned since May. Balfour Beatty said that conflicts with previous discussions between the two companies.

"The board of Carillion is surprised by Balfour Beatty's reaction as the work to date has led to increased confidence in the potential to realize very material value for the benefit of both sets of shareholders," the company said.

Balfour Beatty will proceed "in accordance with its own business plan," which will include the competitive sale process of Parsons Brinckerhoff and its search for Group CEO. 

   

Tagged categories: Construction; Facility Managers; Finance; Mergers

Comment Join the Conversation:

Sign in to our community to add your comments.

Graco Inc.
Eco-Friendly Surface Prep

• Blast with 92% less dust
• Use less media
• Less containment & disposal costs
Graco® EcoQuip® Vapor Abrasive® Blast Equipment Learn more


VP Marketing LLC
Concrete Coating & Seamless Flooring Advisor

• Selecting the Right System
• Marketing Valued Products
• Preventing Problems
Coatings*Mortars*Terrazzo
tmurphy@vpmarketingllc.com


KTA-Tator, Inc. - Corporate Office
KTA Inspection Instruments

Eliminate Application Uncertainties:
• Moisture Content
• Ambient Conditions
• Surface Preparation
• Coating Thickness
Call 1-800-KTA-GAGE
(800-582-4243)


Seymour Midwest
Coating Application Tools & Supplies

Visit our “Where to Buy” site to find a local paint or tool supplier near you. Click here for a chance to win $500 of Tools & Supplies. 1(844)739-6687 Sales@SeymourMidwest.com


Atlas Material Testing Technology

Helping You Put Your Products To The Test

• Outdoor Accelerated
Weathering
• Laboratory Testing
Services
• Accelerated Weathering
Instruments

www.atlas-mts.com atlas.info@ametek.com


Keim Mineral Coatings
Color/Protection for Concrete that Won’t Peel

Concretal® Stains & Finishes penetrate, forming permanent chemical bonds within that can never peel. And mineral pigments don't fade-no matter how harsh the exposure.


PPG Pittsburgh Paints
Wonder-Shield

An outstanding value, Wonder-Shield® provides durable protection against weathering and provides a mildew-resistant coating. It is easy to apply, cures quickly, and can be used on properly prepared wood, siding, trim, sash, masonry, weathered aluminum, vinyl siding and metal.

 
 
 

Technology Publishing Co., 2100 Wharton Street, Suite 310, Pittsburgh PA 15203-1951

TEL 1-412-431-8300  • FAX  1-412-431-5428  •  EMAIL webmaster@durabilityanddesign.com


The Technology Publishing Network

Durability + Design PaintSquare the Journal of Protective Coatings & Linings Paint BidTracker

 

© Copyright 2012-2016, Technology Publishing Co., All rights reserved