JOHN LAING said this week that it planned to double the size of its infrastructure and transport investments business to cushion downturns in contracting and house building.
'Construction is a very cyclical business, as is house building, and what we are trying to do is establish a steady revenue stream from investments to cover difficult periods,' said John Laing Investments director Alan Chaney.
Last week the contractor announced an agreed £6M takeover of train company M40 Trains, which runs passenger services between London, Aylesbury and Birmingham. It made a pretax profit of £2.2M on a turnover of £50.5M in the year to 31 March 1998. The move will see Laing increasing its stake in the business from 26% to 84.3%.
'The long term strategy is to build up our portfolio to represent a third of the group's assets,' said Chaney. Investments now account for 15%.
In 1997 Laing Investments made operating profits of £5M on turnover of £19.7M. This compared with Laing Construction which made a profit of just £4.3M on turnover of £1.12bn, and Homes which made a profit of £21.9M on turnover of £315.4M.
Chaney said other investments were planned in the PFI sector, through the recently established Laing Hyder venture and through UK Highways, which has DBFO concessions for the M40 and the A55 upgrades.
Laing also has a stake in Octagon Healthcare, which is building the privately financed Norfolk & Norwich hospital.