11th Aug 2014 06:49
LONDON (dpa-AFX) - Balfour Beatty PLC Monday said it has terminated discussions with Carillion PLC regarding a merger and it will now look to create opportunities across the group while concentrating on the restoration of value to its shareholders.
Carillion initially approached Balfour Beatty on May 27 with a nil premium merger proposal. The implied ownership split would have been 51% of the combined entity to Balfour Beatty shareholders and 49% to Carillion shareholders. Following successive negotiations with Carillion over several weeks Balfour Beatty agreed to engage with Carillion at the end of June on the basis of an all-share combination with 56.5% undiluted ordinary equity to Balfour Beatty shareholders; 43.5% to Carillion shareholders.
On July 30, it was first communicated to Balfour Beatty that Carillion wished to change the terms so as to retain the Parsons Brinckerhoff business. Following the meeting on 30 July, Balfour Beatty announced that discussions had been terminated on 31 July on the basis of a fundamental concern regarding the proposed treatment of Parsons Brinckerhoff.
Carillion proposed a revised set of terms on August 3. It was proposed to keep the 56.5% / 43.5% split of the business as previously agreed but made some changes and additions to the key terms of the proposal, including: Parsons Brinckerhoff to remain in a combined business, as per Carillion's proposed change to the terms.
Balfour Beatty's Board has considered the revised proposal and concluded that there are a number of significant risks many of which cannot be mitigated. The board concluded that the current proposal from Carillion is not in the best interests of Balfour Beatty shareholders.
Copyright RTT News/dpa-AFX
Related Shares:
Balfour BeattyCarillion Plc