Trading in Leighton Holdings (LEI) shares will resume today after the company finalised the joint venture sale of half of its services business.
Leighton directors yesterday asked for the trading halt for up to two trading days “due to media speculation regarding a transaction involving Leighton’s operations and maintenance services business as part of the strategic review announced in June 2014”.
Late last night Leighton Holdings told the ASX that it had completed the sale of a half share in its assets services arm in a $1.1 billion deal.
The buyer of the half share is US investment group, Apollo Global Management.
The joint-venture will take on the merged operations and maintenance services businesses of Thiess Services and Leighton Contractors Services.
The move comes only a few days after Leighton sold its John Holland construction arm for an unspecified amount to China Communication Construction Co.
LEI YTD – Leighton strikes deal on services business
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Analysts estimate the John Holland sale raised as much as $1.1 billion, while around $700 million of the $1.1 billion will be raised from the services deal.
“By choosing to partner with funds managed by Apollo… we gain access to Apollo’s expertise in creating a single, integrated and efficient business which will be better able to compete in the Australian marketplace," Leighton Holdings executive chairman Marcelino Fernandez Verdes said in the second ASX statement.
He said the deal would also allow Leighton to maintain exposure to the services sector.
The new joint venture will have revenue of more than $2.2 billion, $4 billion of work in hand and about 6400 employees, according to the Leighton statements.
Leighton shares were on $20.95 at the close Tuesday – the trading halt was called for before trading started yesterday.
