Balfour said the public private partnership (PPP) contracts, which include long-term agreements to run projects such as schools and hospitals, were worth much more than the proposal from John Laing Infrastructure Fund.
As the sale would pave the way for the break-up of Balfour, the company warned that the loss of its Investment business would have an impact on its remaining construction and support services operations.
This year Balfour Beatty has issued three profits warnings and its shares have fallen by more than a third, although they jumped this week after John Laing confirmed its interest in bidding for the PPP assets.
Its troubles have been centred around Balfour’s UK construction and engineering services operation due to the impact of design changes, project delays and contractual disputes.
The PPP portfolio was valued at £1.05bn in June but Balfour said it intended to publish an updated valuation next month taking into account recent contract wins, as well as further investments and disposals.
By then it will have a new chief executive as Leo Quinn is due to join the company from defence technology firm Qinetiq on January 1.
Balfour is currently being run by executive chairman Steve Marshall, who fought off a takeover approach from Carillion earlier this year and has said he will step down once a new chairman has been found.
The PPP portfolio includes 13 road projects, five hospitals, eight schools and 21 US housing military projects.
The remainder of Balfour’s business, outside its PPP work, includes construction projects in the UK and US, and rail maintenance in the UK, Germany and Austria.
Since joining the stock market in 2010, John Laing said it has proven itself to be a leading infrastructure fund and ‘’an ideal owner’’ of Balfour’s PPP assets.