Anybody trading in these shares? I just bought some @ 204.72

BBY Balfour Beatty looks to have formed a base on the chart. Last results last week had no nasties 190p then 220p aim SP targets on chart.

Looking good GF - I've been watching since the last fall - I did buy the prefs @101.75p



Canaccord Genuity Hold 170.00 - 185.00 Initiates/Starts

Beat me to it again Skinny. Yep so good to see nothing nast in the last RNS.

Could be a quick riser this with all those gaps.

Merrill Lynch note:
"We are upgrading our rating on Balfour Beatty to Buy from Neutral with a 12-month SOTP-derived PO of 230p. Five profit warnings in UK Construction in the past two years have led to significant underperformance vs the sector and the stock is down 50% from its highs in February 2014. However, the balance sheet is now solid (£200mn net cash at Dec-2014E) post the sale of Parsons Brinckerhoff, and most businesses (notably PPPs and US Construction) are performing well. KPMG’s review of contracts in UK Construction is due by year-end and creates certain overhang, However, this looks priced in as to justify the current share price based on a SOTP, we would have to assume UK Construction is worth a negative £500m.

Balfour Beatty has recruited Leo Quinn – who engineered successful turnarounds at De La Rue and QinetiQ – as the new CEO, due to start on 1 January 2015. Quinn has a strong track record on working capital optimisation, reducing pension deficits and cost cutting. Management change could also be a catalyst for adopting a more focused strategy and exiting some of the loss-making businesses in the UK.

The c.£200mn net cash position we forecast at Dec-2014 equates to nearly 18% of the current market cap and represents a strong support in terms of valuation and liquidity. Headroom to covenants (3x ND/EBITDA) exceeds £500mn in 2015E.

Our SOTP for Balfour Beatty results in a PO of 230p, offering (41%) upside potential with US Construction and Support Services valued in line with listed peers and the PPP portfolio in line with BBY Director’s valuation, while disposals of PPP assets have been carried out at a premium historically. Balfour Beatty was approached by Carillion over the summer, and while talks broken down, the stock is now 30% lower and we think M&A appeal remains. At the current share price, UK Construction is valued at a negative £500mn EV. At our 230p PO, we think it would be valued at zero. Revision of our earnings estimates reflects the de-consolidation of PB from 1 Jan 2014 and the company’s FY outlook downgrade on 29 September 2014.

Discount to SOTP and PPP assets could attract a bidder.
Balfour Beatty is trading at a 30% discount to SOTP (our 230p Price Objective) and we think retains significant M&A appeal for a player looking for a back door to its portfolio of PPP assets and willing to take a 2-3 year view, before potential UK restructuring starts bearing fruit. As our PO is obtained using zero value for UK Construction, turning around this business would offer further medium-term upside on top of the 230p PO.

In July and August 2014, Balfour Beatty was approached by its UK peer Carillion, although the talks ultimately failed. Balfour Beatty insisted on divesting Parsons Brinckerhoff, which Carillion was keen to retain. Carillion’s final offer in late August would give Balfour Beatty shareholders 58.3% of the combined company and an 8.5p dividend, implying a standalone valuation for Balfour Beatty of just above 300p (according to Carillion calculations). The offer also represented a 36% premium to the company’s average share price in the month before the initial offer was made and 30% premium to the price on 24 July 2014, the day before the talks begun.

Carillion cannot make a hostile bid on BBY until Feb 2015 In its rejection of Carillion’s final proposal from 19 August 2014, Balfour Beatty citied risks associated with the businesses plan, including the proposed significant downsizing of the UK Construction business, as it would curtail its medium-term recovery potential. It also stated its intention to proceed with Parsons Brinckerhoff disposal, which was eventually finalized in October 2014. Under UK takeover rules, Carillion cannot make a hostile bid for Balfour Beatty for six months, ie, until February 2015. Both companies could also hypothetically reengage in tie-up talks (ie after expiry of 3 months lock-up post the rejection in 19 August 2014).

26 Nov 2014 Balfour Beatty PLC BBY Liberum Capital Buy 178.25 176.80 250.00 250.00 Reiterates

SP Target 250p

Balfour Beatty boosted by hopes of revival or new bid, while FTSE drifts higher
Troubled construction group could be on road to recovery, say Merrill Lynch analysts 26/11/2014



Balfour Beatty has been through the mire recently, with several profit warnings, changes of top executives and a failed bid from Carillion.

But it looked brighter after a positive note from Bank of America Merrill Lynch, which moved from neutral to buy albeit with a target price cut from 250p to 230p, based on a recovery at the business and the prospect of Carillion taking another tilt at the company come next February. Merrill analyst Marcin Wojtal said:

Five profit warnings in UK construction in the past two years have led to significant underperformance versus the sector and the stock is down 50% from its highs in February 2014. However, the balance sheet is now solid (£200m estimated net cash in December 2014) post the sale of Parsons Brinckerhoff, and most businesses (notably public private partnerships and US construction) are performing well. KPMG’s review of contracts in UK construction is due by year-end and creates certain overhang. However, this looks priced in, as to justify the current share price based on a sum of the price, we would have to assume UK construction is worth a negative £500m.

We think [Balfour] retains significant M&A appeal for a player looking for a back door to its portfolio of PPP assets and willing to take a 2-3 year view, before potential UK restructuring starts bearing fruit.

Under UK takeover rules, Carillion cannot make a hostile bid for Balfour Beatty for six months, ie, until February 2015. Both companies could also hypothetically re- engage in tie-up talks (ie after expiry of three months lock-up post the rejection in 19 August 2014).

Its shares closed 13.7p or more than 8% higher at 176.8p.

Hi GF ,i 'm in here this week ,going well at the moment .

Yep Jimmy giving it a bit more of a push.

BBY Balfour Beatty on verge of breaking into a gap and proceeding up to 220p in quick order. Rec stock and TO Target.

Surely indicators approaching overbought at the moment?

Thats true but Harry look at the volume.

Now if the volume had fallen away badly I would be with you, but it hasnt say compared to the summer period.

Theres a lot of charts around like this at the moment all looking overbought but still being very resilient and making daily gains.

Plus going up to Christmas volumes fall off anyway and SPs increase.

Could always check it out using momentum and ADX.

Give me 10 mins and I will do.

Here we are, just look at the green signal line turning up on ADX, and dont forget Harry ADX is a lagging indicator. Momentum is pretty positive aswel.

Harry - plenty of gas left in that RSI :-)

JLIF Statement

JLIF STATEMENT REGARDING THE BALFOUR BEATTY PPP PORTFOLIO

Further to recent press speculation, John Laing Infrastructure Fund Ltd ("JLIF") confirms that today it is making a non-binding proposal, subject to due diligence, to the Board of Balfour Beatty plc for its PPP Portfolio (the "Portfolio") for approximately GBP1bn in cash.

Since its IPO in 2010, JLIF has proven itself as a leading London-listed infrastructure fund investing in low risk, operational infrastructure assets and therefore believes it would be an ideal owner of the Portfolio.

Following due diligence and in the event agreement is reached to purchase the Portfolio, JLIF would seek to finance the acquisition largely via an equity capital raise of ordinary shares, as with its previous acquisitions.

A further announcement will be made when appropriate.

UPDATE 1 – John Laing Fund makes 1 bln stg offer for Balfour assets
01 Dec 2014 - 07:52

(Adds background, Kier Group in talks with Mouchel)

LONDON, Dec 1 (Reuters) – John Laing Infrastructure Fund on Monday offered to buy Balfour Beatty's portfolio of public-private partnership assets, operating in sectors like education and health, for 1 billion pounds ($1.6 billion) in cash.

JLIF said it would fund the deal by issuing shares.

The group is one of Europe's largest listed infrastructure funds which partners with public sector groups across the world to deliver local and national infrastructure projects.

John Laing's swoop for the assets comes after a troubled couple of years for Balfour Beatty, during which it has issued a string of profit warnings and fended off takeover approaches from rival Carillion .

The infrastructure group has appointed turnaround specialist Leo Quinn from defence firm Qinetiq as its new chief executive, tasked with leading a strategic review of the group when he joins on Jan. 1. ...

ThanksGF and Skinny. Without you I'd be in the dark given Moneyman hasn't given a news flag on bby :-(

John Laing fund prepares £1bn bid for Balfour assets
John Laing Infrastructure Fund wants to buy the private public partnership portfolio of struggling construction firm Balfour Beatty.

by Gavin Lumsden on Dec 01, 2014 at 08:34

John Laing Infrastructure Fund (JLIF +
) is making a £1 billion bid for the private public partnership portfolio of struggling construction firm Balfour Beatty.

Following weekend reports the investment arm of John Laing, a rival construction firm, confirmed this morning that subject to due diligence it was making a non-binding proposal to buy the PPP assets in cash.

Balfour Beatty (BALF +
) shares jumped 9p, or 5%, to 192p but after a string of profits warnings have lost about a third of their value this year. After resisting a takeover bid by Carillion in the summer it replaced all its senior management.

JLIF shed 3p to 120.5p.

According to reports the PPP portfolio has previously been valued at £1.1 billion and includes contracts to run student and military accommodation, roads and hospitals. This is a similar mix of assets JLIF already runs. The Guernsey-based investment company was spun off and separately listed on the London Stock Exchange in 2010,

As with previous acquisitions, JLIF said it would finance the purchase by issuing shares to investors.

Launched four years ago, JLIF is managed by David Marshall and Andrew Charlesworth. At 5.2% it is the highest yielding of four social infrastructure investment companies. It has generated a 13.5% total return for shareholders over three years.

No probs kernow.

BRIEF – Balfour Beatty to review John Laing Fund's proposal once received

01 Dec 2014 - 12:02

Dec 1 (Reuters) – Balfour Beatty Plc

Response to jlif announcement
Notes announcement by john laing infrastructure fund ltd ("jlif") that it intends to make a non-binding proposal for balfour beatty's ppp portfolio
Will review proposal once received from jlif. A further announcement will be made in due course, as appropriate
Source text for Eikon: ... Further company coverage: BALF.L

Broker talk on the proposed deal yesterday.......

John Laing Infrastructure Fund has made a £1bn offer for Balfour’s portfolio of public private partnership assets, which operate in education, health and other sectors. JLIF has fallen 2.3% to 120.4p after it said it would issue shares to fund the transaction.

But analysts suggested the offer price was on the low side and could attract rival bidders. Meanwhile Carillion, which was rebuffed in an offer for the whole of Balfour Beatty, could return in February.

Liberum said:

We do not think that this is a very generous offer. Balfours’ own conservative directors value was £1,051m at the interims, although there will have been some changes since then including the closure of the Greater Gabbard OFTO |(£15m of equity), the unwinding of the discount and disposals (we assume gains of £33m in the second half or proceeds of £66m assuming two time book). In our mind, even if all of the assets were sold for this low number, the PPP business would still have a material value, note the £170m of equity expected to be invested over the next two years and the likelihood of investments beyond that.

While the Laing offer looks low, it does highlight the significant value of the business. Balfour Beatty’s market cap is £1.3bn; there is at least £1.0bn of PPP assets, we estimate £0.3bn of residual PPP value, we estimate £490m of value on Support Services and £70m of pro forma average cash (£220m of year end cash). This indicates a negative value of £0.6bn for the rest of the business, which is too low, given that most of Construction is performing satisfactorily and the losses can be discontinued (albeit with significant write-offs in January).

Oriel issued a downbeat note of JLIF on the news:

Whilst at this stage there is a lack of information on the proposal, we do think it is likely that in addition to JLIF there are likely to be a number of parties interested in these PFI assets. A large queue of potential buyers could well form, with the danger being that the ‘winning bidder’ is likely to end-up paying a relatively high price for the assets. A £1bn equity issue would double JLIF’s size from its current market cap of £1bn and some investors are likely to welcome the increased stockmarket liquidity associated with an enlarged JLIF. The market currently seems to have an insatiable appetite for listed infrastructure, with this demonstrated by the mid-teen premia that many of the funds are currently trading on. However, we do think there is likely to be some short-term indigestion if the market has to absorb £1bn of equity from JLIF. We re-iterate our reduce recommendation with a fair value of 113p and we think it likely that the whole listed infrastructure fund sector may see some price weakness in the short-term given the size of this potential equity issuance.

Meanwhile Canaccord Genuity said:

It initially looked unclear as to whether or not this included the US portfolio or just the UK - as this makes a huge difference. The sensitivities are that if it is just UK, we value the UK current assets at £877m plus a value for the UK pipeline of £55m, which makes £932m; so if it is just UK it is a fair price and could be looked at. If it includes the US, which having spoken to Laing’s PR company Finsbury it appears to do, it is a poor price and should be dismissed in our view, as we value the combined UK/US business at £1.3bn in our sum of the parts.