London — Balfour Beatty, the international infrastructure group, reached an agreement with a subsidiary of CBRE Group, Inc. to sell Heery International (Heery), its full-service U.S. engineering and program management, architecture and interior design firm.
The transaction, which is subject to certain contractual consents, is expected to complete before year end for a total cash consideration of $57 million (c.£42 million), subject to working capital and debt adjustments.
For the year ended December 31, 2016, Heery’s gross assets were £78.2 million, net assets were £21.5 million and profit before tax was £2.4 million. This transaction will release funds to Balfour Beatty to be used in the normal course of business.
Balfour Beatty acquired a 50% interest in Heery in 1986, which it increased to 100% in 1990. In certain U.S. markets, however, acting as Program Manager on a contract precludes a company from bidding as General Contractor due to perceived conflicts of interest. The sale of Heery removes this constraint from the Group’s U.S. Buildings operation, while enabling it to partner with Heery on a wide range of potential projects going forward.
Leo Quinn, Group Chief Executive, said: “We continue to focus and strengthen the Group in our chosen markets. This transaction is another example of maximizing shareholder value at the appropriate time and value, while improving our strategic position. We look forward to continuing our strong working relationship with CBRE.”