Lendlease Corporation said it will sell its United Kingdom (U.K.) construction business to industrial holding company Atlas Holdings effective 31 December 2024.
Lendlease (ASX: LLC) said it would receive £35 million (A$70 million) cash including £10 million deferred until June 2026, subject to completion adjustments.
The company said the sale to Atlas Holdings would finalise its exit from international construction well ahead of the targeted 18-month timeline announced at the May 2024 strategy update.
The sale accelerated the simplification of the group, focused on the growth of its Australian operations and international Investments platform and followed the recent sale of its US East Coast construction operations.
“This transaction builds on our progress to simplify Lendlease as we look to lower our risk profile and increase securityholder returns. It also represents a positive outcome for both our people and our valued customers, ” CEO Tony Lombardo said in an ASX announcement.
Lendlease said the profit outcome was expected to be broadly neutral after providing for retained risks related to projects that have been completed or substantially completed prior to the exchange of the sale agreement.
“The net cash outflow as a result of the transaction is anticipated to be approximately $100 million due to the unwind of negative working capital in the business prior to and at transaction close and including the offset from receipt of initial sale proceeds,” it said.
Lendlease said earnings guidance for the 2025 financial year (FY25) remained unchanged with group earnings per security of 54 to 62 cents expected, heavily skewed to the second half due to the delay in the completion of the Military Housing sale which was now expected to contribute $145-160 million of operating profit after tax.
Lendlease shares closed on 31 December at $6.23, capitalising the company at $4.23 billion.