Balfour Beatty pull plug on merger
Plans for the creation of a new FTSE 100 construction giant have collapsed after Balfour Beatty pulled the plug on a potential deal with rival Carillion.
The withdrawal was blamed on Carillion's "wholly unexpected decision" to insist that Balfour's US business Parsons Brinckerhoff was included in the deal.
The two sides had previously agreed to start merger discussions on the basis that Balfour continues with previously announced plans for the sale of Parsons, a business it bought for £380 million in 2009.
Shares in Balfour and Carillion were around 5% lower yesterday, having surged in recent days on hopes that the two companies will agree a £3.4 billion tie-up. The discussions followed an approach from Carillion with Balfour struggling after a series of profits warnings and the departure of chief executive Andrew McNaughton.
Balfour, which was foundedin 1909, built the aquatics centre at the London 2012 Olympics site.