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Carillion calls off Balfour Beatty merger bid
Building giant Carillion has backed away from its bid for rival Balfour Beatty after three unsuccessful attempts.
Ahead of tomorrow's "put up or shut up" 5pm, Carillion this afternoon issued a statement saying it was "no longer proposing a merger".
Balfour Beatty shares opened 5.7 per cent lower per cent this morning after its board refused a third offer from Carillion. The board said the proposal, which would have valued Balfour at £2.1bn and given shareholders 58.27 per cent of the combined company, was "not in the best interests of its shareholders".
Although many Balfour investors had privately supported a deal, the two companies came to blows over Balfour's US design consultancy Parsons Brinckerhoff. Balfour is said to be in advanced negotiations with Canadian firm WSP Global to sell the firm for $1.2bn (£717m) – but Carillion wanted Balfour to retain the firm as a condition of the deal.
Balfour also disputed figures by Carillion which suggested the two could stand to benefit from £175m annual cost savings.
Balfour shares fell sharply after the announcement, to 236p, 7.81 per cent lower than last night's closing price. Carillion shares, which hit a low of 325.8p this morning, climbed slightly to 329.3p after the announcement, 2.20 per cent lower than last night's close.