On Tuesday (19 August), Carillion put forward improved merger terms, offering Balfour Beatty investors an increased share of the company to 58.3 per cent and also said it would pay Balfour Beatty’s shareholders a final 8.5p cash dividend.
However after considering the terms of the new deal Balfour Beatty issued a statement citing that the revised proposal again failed to address the two key concerns that it has consistently raised with Carillion. These being, “the considerable risks associated with the proposed business plan, including the strategy to significantly reduce the scale of the UK Construction business when it is poised to benefit from a recovery in the market, and the continued intention to terminate the sale of Parsons Brinckerhoff at a point when it is reaching a successful conclusion”, which has been a bone of contention from the outset.
As a result, Carillions third proposal has therefore been rejected as the Balfour Beatty Board unanimously agreed that the proposal was “not in the best interest of its shareholders”.
Balfour also confirmed in its online statement that it will not be seeking an extension to the ‘Put Up or Shut Up’ (PUSU) deadline which comes into effect as of 5pm today (21 August).
In response to Balfour Beatty’s announcement, Carillion has issued a statement declaring that it is “no longer pursuing such a merger”.