Chris Ames 13 December 2018

Amey set to go private, report says

Roads and services contractor Amey is set to be sold to a private equity firm in the New Year, it has been reported.

The Financial Times said that Ferrovial, Amey’s Spanish owner, is in talks with PAI Partners and Greybull Capital over a potential sale of the business, ‘according to people close to the vendors'.

Last week Ferrovial said in a statement: that it ‘has entrusted an external consultant to explore the potential divestment of all or part of the assets of the services division of which Ferrovial owns directly or indirectly'.

The FT quoted another source as saying that Ferrovial ‘may need to package [Amey] with other parts of the business to find a buyer’.

Amey has been hit by a number of setbacks recently, including losing a long-running legal battle over its 25-year Birmingham PFI deal, which saw it set aside £208m to cover possible costs.

The FT quoted someone ‘close to the bidders’ as saying that, if taken private, the firm would be able to resolve ‘long-running contractual negotiations like this much more quickly away from the public eye’ and adding: ‘They can be a lot tougher if they don’t have to worry about reputational risk to the same extent.’

Despite its problems in Birmingham, Amey recently secured major contracts in Highways England’s Area 10 worth a combined £375m as well as a place on the strategic road operator’s Regional Delivery Partnership framework.

The FT said that Ferrovial, which owns Heathrow Airport, is aiming to narrow its focus to transport infrastructure, including its profitable toll roads business in North America, ‘according to people close to the company’.

A spokesperson for Amey declined to comment.

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