Morrison sells off equity share

by John Leitch



Morrison Construction announced on Monday (10 April) that it had sold half its equity investment in five private finance initiative projects to Edison Capital, a subsidiary of the US electricity generating and distribution group. Money from the sale is being used to form a PFI joint venture vehicle, MEIL, with Edison.

Chairman Sir Fraser Morrison said: "It will allow Morrison to participate, in far greater depth, in the PFI market."

Morrison will concentrate on five PFI markets: health, education, Ministry of Defence, social housing, and road building.

Finance director Bob Green said he hoped that the joint venture deal would enable the group to win PFI schemes with a total construction value of £500m. It will also enable Morrison to bid for larger PFI projects. "The opportunities in PFI are tremendous," said Green.

Morrison has a PFI equity portfolio worth £14m spread across seven projects. It was making a profit on the equity that it sold to Edison. "We've been looking to do this for a time," said Green, "and had been talking to many institutions. Edison is new to the UK. We are selling to churn the cash. We don't want too much cash tied up over a long time and we'd like to invest more than we do at the moment."