Disposal

Balfour Beatty PLC
10 May 2007


10 May 2007


                BALFOUR BEATTY AGREES THE SALE OF ITS INTEREST IN
               DEVONPORT MANAGEMENT LTD TO BABCOCK FOR £86 MILLION
               ===================================================

Balfour Beatty, the international engineering, construction, services and
investment group, announces today that it has agreed to sell its 24.5% interest
in Devonport Management Ltd (DML) to Babcock International plc (Babcock) for a
cash consideration of approximately £86 million.

DML was established in 1987 to run Devonport Royal Dockyard, which it then
acquired in 1997. It offers a complete range of design, build and support
solutions across both the defence and commercial sectors, including nuclear
submarine refit, refueling and maintenance.

Commenting on the transaction today, Balfour Beatty Chief Executive, Ian Tyler,
said:

'Devonport Management has been a very good investment for Balfour Beatty and we
are pleased to have played a part in the success of the enterprise. However,
long-term involvement in DML is not core to our strategy and a sale on the terms
agreed represents excellent value for our shareholders. This sale places the
combined Babcock and DML businesses in a primary position to achieve
consolidation of UK submarine assets.'

The profits after tax attributable to the interest disposed of by Balfour Beatty
for the year 2006 were £7.4 million. The gross value attributable to the assets
being disposed of by Balfour Beatty was £71 million at 31 December 2006. The
disposal will lead to an exceptional profit of approximately £50 million in
Balfour Beatty's 2007 accounts.

The cash proceeds will be used to continue to develop Balfour Beatty's business
in line with its stated strategy.

The other shareholders in DML, who are also selling their interests to Babcock,
are KBR (51%) and the Weir Group (24.5%). The transaction is conditional upon
the approval of the Ministry of Defence and the shareholders of Babcock. It is
anticipated that the transaction will be completed within approximately 60 days.

                                      ENDS

Enquiries to:
Tim Sharp
Tel: [phone]
www.balfourbeatty.com




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