John Laing in £300m joint venture

PFI investor John Laing has got a boost to its plans to make money out of hospitals and roads after agreeing a £300m joint venture with Commonwealth Bank of Australia.

Laing, which has transformed itself from a constructor into a project manager of private finance initiative (PFI) projects, said today it will take up joint-venture investments in building UK hospitals and roads around Europe, which it sees as a growing market.

The move by Commonwealth Bank mirrors the investment in infrastructure in Britain and on the Continent by rival Australian bank Macquarie.

Announcement of the venture comes as Laing today took control of the company it already co-owns and runs the M40 from London to Oxford on behalf of the Highways Agency.

Laing said it is paying its joint venture partner, road-laying group Carillion, £19.65m for the 50% of the company that it does not already own.

Carillion said the sale, plus the disposal of its 100% interest in running the A249 in Kent to Barclays Bank's infrastructure division, has given it a £7m profit windfall.

Part of those proceeds will be distributed to shareholders in the form of a 1p special dividend. In a trading statement, Laing said today it expects to hit City analysts' current expectations helped by a strong performance from its Chiltern Railways business running into Marylebone. Against a national average of one in five trains running late, Chiltern said its trains are 91% punctual, a performance which has helped it grow passenger revenue by 14% over the past year.