Construction giant Leighton is handing over a 50 per cent share in its services operations to a US investment firm in a deal valuing the business at $1.075 billion.
Leighton said it will use $700 million in proceeds from the 50-50 partnership deal with Apollo Global Management to further reduce its debt.
Leighton Services employs about 6,400 workers and generates revenue of more than $2.2 billion from operations including facilities management, design and construction, telecommunications maintenance and land remediation.
Chief executive Marcelino Fernandez Verdes said the partnership deal would provide Leighton with access to Apollo’s expertise in creating efficient businesses, while maintaining its exposure to the growing services market.
Since June, Leighton has been seeking to cut costs and streamline its operations and management.
Last week it agreed to sell its John Holland contracting and engineering business to a major Chinese construction firm for $1.15 billion.
That deal was expected to reduce Leighton’s debt to equity ratio by 10 percentage points, and the Apollo deal will reduce that by a further 10 percentage points, Leighton said.