A Chinese construction firm is examining a $3 billion takeover of Balfour Beatty, the UK’s biggest contractor, according to press reports.
China Civil Engineering Construction Corporation (CCECC), a subsidiary of the state-backed China Railway Construction Corporation, has consulted with industry figures about a potential bid, The Sunday Times reported.
“CCECC, which has sounded out advisers in the past two months, is understood to be particularly interested in Balfour Beatty’s involvement in big projects such as Crossrail,” the newspaper said. Crossrail is a 118-kilometre (73-mile) railway line under construction in London.
The firm – which employs about 36,000 people – in March reported a huge pre-tax loss, including $22.32 million from its Middle Eastern operations during 2014.
The London Stock Exchange-listed firm, which operates in the UAE through the joint ventures BK Gulf and Dutco Balfour Beatty, reported total worldwide losses of £59m ($88m) last year.
That total loss figure would have amounted to £304m ($452.4m) were it not for the sale of its US construction business, Parsons Brinckerhoff.
It said its poor performance in the Middle East was largely due to two specific contract positions within the mechanical and electrical (M&E) engineering joint ventures.