The deal values Ballast Nedam, bought by BAe in 1987 for pounds 47m, at about pounds 15m more than its book value. Ballast Nedam is about twice the size of Boskalis, which specialises in dredging, and made a profit before interest of pounds 9m on sales of pounds 440m in the first half.
The business was bought by BAe to enhance its capabilities as a 'turnkey' contractor, able not only to supply fighter aircraft and other military hardware but also to build the air bases from which they would operate.
Ballast Nedam was involved extensively in the pounds 20bn Al Yamamah arms-for-oil deal between Britain and Saudi Arabia, a programme on which BAe is the lead contractor, and also constructed a 25km causeway between Saudi Arabia and Bahrain.
Although Ballast Nedam employs about 3,000 people, most of these are overseas. Its UK subsidiary, Ballast Nedam Construction in Bromley, Kent, has a workforce of about 275 involved in general building and maintenance and small civil engineering projects.
But the decision of Saudi Arabia to postpone indefinitely plans for the Al-Sulayil air base, which was to cover an area the size of Greater London, has made Ballast Nedam much less important to BAe.
This is the second sale of a BAe subsidiary this year. In May it sold its corporate jet business in Chester to the US firm Raytheon, maker of Beech aircraft, for pounds 250m.
News of the agreement with Boskalis failed to lift BAe's shares, which fell a further 6p to 393p on fears that its joint venture on regional jets with Taiwan may be cancelled.Reuse content