In a move that could have mixed implications for the construction industry, the proposed £3 billion merger between construction giants appears to have fallen apart spectacularly after Carillion appears to have caused Balfour Beatty to pull out of the merger talks.

Carillion opened talked with Balfour Beaty, which has been struggling with profit warnings and a lack of chief executive, in a move which drove up the share value of both companies.



Although the two organisations have worked together in harmony over the years, it now appears the creation of a mega-construction giant on the FTSE 100 is a dead duck.



The main stumbling block appears to be over Parsons Brinckerhott, Balfour Beatty’s profitable US business. Balfour Beatty have been planning to sell off the US side of the organisation for a number of months, however this is something Carillion have only recently declared should be part of the deal.

“This change in the proposed terms is not acceptable to the board of Balfour Beatty,” the company said. Carillion is yet to comment.



Unfortunately, shares in both companies fell 5%, with Carillion down 16.45p to 336.75p and Balfour off 11.95p at 240.75p.



Although not a positive outcome, the merged company could have brought significant improvements to efficiency, it’s likely it would have created some job losses in the processes which could have caused some instability in the short to medium term for the construction industry in the UK.