Leighton in trading halt amid divestment speculation

CONSTRUCTION giant Leighton Holdings is in a trading halt on the Australian Securities Exchange amid speculation it is about to sell its operations and maintenance services division for $1 billion to an American private equity firm.

Haydn Black

t has been rumoured for some time that Leighton, which recently sold its John Holland business unit to the Chinese for $1.15 billion, has been in talks with US-based Apollo Global Management for the sale.

Apollo has been on a buying spree lately, reportedly spending almost $US8 billion on New York-listed pet-related retailer PetSmart.

It was described as the largest private equity buyout by a US firm this year.

Apollo has also entered into an agreement to acquire IT infrastructure solutions provider Presidio on undisclosed terms.

Presidio is a reseller chiefly known for providing infrastructure solutions to customers in the US and supports networking, data centres, mobility, security and that most 21st Century of IT concepts “the cloud”

Apollo reportedly wants to have up to $US300 billion in funds under management by the end of the decade.

Part of that is expected to be its bid for Leighton’s services business, although just what the deal will cover remains unclear given Leighton’s interests in utilities and infrastructure, facilities management and the Visionstream communications business.

Leighton is also believed to be keen to offload its 50% holding in property developer Devine although that deal, rumoured to be with builder AVJennings, is unlikely to be completed until next year.

Leighton’s new majority owner Hochtief is trying to simplify the business.

Leighton said its shares would remain in a trading halt for up to two days.

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