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Balfour Beatty to set up £750m fund

Balfour Beatty will set up infrastructure fund and sell around £300 million of its assets

The company told investors and analysts that the new fund would invest in core economic infrastructure such as transport, utilities and energy projects.

The firm will also invest in the fund, which will be headed by Rob Gregor, formerly head of European infrastructure at AMP Capital Investors and chaired by Andy Friend, formerly chief executive of Laing plc.  The fund will raise £500m to £750m in the long term with the first close coming in 2011 when the fund is worth a smaller sum.

In a separate move, the company will sell £200m to £300m of PPP assets that it holds, particularly older ones. The money will be invested in developing new assets and in incremental dividends to shareholders.

The company plans to increase its margins from 2.7 per cent in 2009 to 3.5 to 4 per cent over the next five years.

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