Construction giants consider merger

Balfour Beatty and Carillion in talks about £3bn merger

Balfour Beatty and Carillion, two of the UK's largest construction firms, have disclosed they are in talks about a potential £3 billion merger.

The talks, which follow an initial approach from Carillion, come with Balfour struggling after a series of profits warnings.

The companies said the combination has the potential to create a support services and construction business of "considerable depth and scale".

Carillion has a market value of £1.45 billion, while Balfour is worth around £1.6 billion after a sharp fall in its share price since March.

Balfour has been rocked by project delays and contract disputes at its Cheadle-based engineering services business, which has been the source of the recent profit downgrades.

The companies said: "The boards of Carillion and Balfour Beatty believe that the merger of the two groups has the potential to create a market leading services, investments, and construction business of considerable depth and scale."

Wolverhampton-based support services firm Carillion employs more than 40,000 people worldwide, with established businesses in the UK, Canada, the Middle East and North Africa.