Balfour Beatty, the UK’s largest contractor, has announced that it plans to sell its 49% share in two joint ventures to partner, Dubai-based Dutco, and leave the Middle East.
Balfour will sell its 49% share in general contractor Dutco Balfour Beatty and M&E specialist BK Gulf for £11m in cash.
As part of the transaction, Dutco will assume responsibility for Balfour Beatty’s “guarantees of bonding obligations” in the joint ventures.
According to Balfour’s 2015 Build to Last report, the two companies together had revenue of £372m and made a pretax loss of £65m.
As part of a general strategy of tightening management control, Balfour has decided to narrow its area of operations, leaving Indonesia and Australia to focus on its more established markets in UK and US, as well as Asia Pacific, where it owns half of Hong Kong contractor Gammon.
Leo Quinn (pictured above), the chief executive of Balfour Beatty, said: “We continue to simplify the group and strengthen the balance sheet through our Build to Last programme.
“As a result, Balfour Beatty enters phase two of its transformation with a solid foundation for long-term profitable growth.”
Dutco Balfour Beatty has won contracts in Dubai worth $408m in 2015 and $352m in 2014.
In August 2016 Balfour cut its half-year loss to £66m and reinstated dividends.
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