The sale of Lendlease to a US private equity firm has been called in for government scrutiny on national security grounds.
Last week, Lendlease Group announced it had reached an agreement to sell its UK construction operations to US private equity firm Atlas Holdings for £35m.
Construction News understands that the deal is now being examined by officials under the National Security and Investment (NSI) Act.
The act allows the government to intervene in deals that could impact the UK’s national security.
The call-in is not expected to scupper the acquisition but could delay it slightly.
Under the act, the government has 30 days to consider the acquisition but can extend for a further period of 45 days and then a further period if agreed with the firm involved in the acquisition.
The government can then either chose not to intervene or impose conditions on the deal.
The law covers takeovers in 17 defined areas of the economy, including data infrastructure, defence, energy, the military and strategic transport projects.
Firms buying any supplier holding plans or drawings for projects carried out for the Ministry of Defence (MoD) are automatically in scope.
According to data provider Glenigan, Lendlease currently has five contracts with the MoD.
In July, Lendlease Construction Europe picked up three deals for British Army facilities under a broader £5.1bn MoD framework.
The contractor said that the deals, worth a combined £450m, were procured under the Defence Estate Optimisation Army Programme by the Defence Infrastructure Organisation.
Lendlease is building new accommodation, office and training facilities and extending existing facilities at Imjin Barracks (pictured) in Gloucestershire, St David’s Barracks in Oxfordshire, and Beacon Barracks in Staffordshire.
A spokesperson for the Cabinet Office told CN it had a policy of neither confirming nor denying whether specific deals had been called in under the NSI Act.
Analysis by The Times today revealed that UK investors made up 61 per cent of notifications made under the NSI Act in the 12 months from April 2023, followed by the USA at 22 per cent.
Yesterday, CN reported that Atlas Holdings intends to rename Lendlease, resurrecting the historical Bovis brand name it dropped in 2011.
It is not planning a major restructure of operations.
