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Balfour builds up £180m warchest

The country’s largest contractor is raising £180 million to splash out on making its business even bigger.

The £7.5 billion turnover firm said it will raise the cash through a share placement and will use it to buy up more regional contractors. Over 43 million new shares will be issued.

The firm has snapped up Dean & Dyball and Cowlin in the past year and chief executive Ian Tyler has said in the past it wants to strengthen its regional contracting business in the South-east such as Surrey, Sussex and Essex.

It also wants to strengthen its US arm, increase its investment in infrastructure as well as bolster its professional and technical services operations.

News of the warchest came as the firm said it was confident of reaching the top end of current expectations this year after starting 2008 with a strong trading performance.

In a trading statement today, the firm said a number of major new orders across the business which has seen its confirmed order book grow from its ‘very satisfactory’ year-end levels.

Balfour has a 40 per cent share in the Connect Plus team which secured the £5 billion M25 widening job last week.

The award of the £300 million 2012 aquatics centre contract is another of several contracts ranging from £125 million to £300 million secured by the firm since the start of the year.

The firm boasted continuing progress in the building and engineering sectors with the rail sector performing well.

Current chairman Sir David John will be replaced by former Network Rail chief Steve Marshall after today’s AGM.