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Balfour Beatty Plc share price down, boosts its public-private partnership valuation by 46% to £1.05 billion

Balfour Beatty Plc, which is currently the largest building company in the U.K., increased the valuation of its public-private partnership projects by 46% to £1.05 billion ($1.7 billion).

The head of the infrastructure investments unit of Balfour Beatty – Mr. Ian Rylatt said in the companys statement, which was cited by Bloomberg: “The revaluation ensures that investors have a clear understanding of the real value of assets held within our PPP portfolio. We also believe the valuation is still based upon somewhat conservative assumptions.”

Balfour Beatty, which recently rejected a merger bid from Carillion Plc, had been expected to release a new valuation along with the interim results posted earlier in August 2014. The revaluation, however, was delayed by the expiration of Carillions offer period. According to the companys statement, its PPP portfolio was revalued according a new valuation methodology, which also highlights improved cash flow and macro-economic assumptions.

Public-private partnerships are infrastructure ventures funded with both government and company money. Balfour Beatty participates in a total of 37 such projects on the territory of the U.K. and 26 on the territory of the U.S. The companys contracts to build and manage assets, which include schools, hospitals, military housing, building roads, etc. have been revalued to £1.051 billion, a 46% increase from the previous valuation of £766 million.

The company shared that its portfolio valuation in the U.K. rose by 63% and reached £801 million, while the valuation of its North America portfolio amounts to £250 million, marking a 9% increase.

Balfour Beatty Plc lost 0.68% by 11:37 GMT in London to trade at GBX 245.32 per share, marking a one year change of -2.15%. The company is valued at £1.70 billion. According to the Financial Times, the 12 analysts offering 12-month price targets for Balfour Beatty Plc have a median target of GBX 229.00, with a high estimate of GBX 280.00 and a low estimate of GBX 183.00. The median estimate represents a -7.29% decrease from the previous close of GBX 247.00.

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