Keller to benefit from US tax changes, in talks over US acquisition

In 2016, Moretrench generated revenue of $170m, operating profit of $9.3m and earnings before interest, taxes, depreciation and amortisation of $13.9m. Should it proceed, the deal, which remains subject to the satisfactory completion of due diligence, will be funded wholly in cash using existing borrowing facilities.

Keller said the enlarged group will represent "by far the most capable geotechnical solutions provider on the east coast" and will be very well positioned for the expected long run renewal of infrastructure. In addition, the deal gives Keller access to new niche geotechnical products and new industrial customers and should have good revenue and cost synergies.

Keller and Moretrench have partnered on a number of successful project joint ventures in the past.

Also on Friday, the company said that changes to US taxes will benefit its future after tax earnings thanks to the reduction in the corporate income tax rate to 21% from 35%, partly offset by a net adverse impact from other changes.

"Our current estimate, which is subject to further analysis and clarification of certain items, is that the changes will reduce the group's future overall effective percentage tax rate by around 5% points to a number in the high twenties percent.

"In addition, we expect that the group's 2017 earnings will benefit from a one-off non-cash credit to the group income statement as a result of the revaluation of US deferred tax liabilities. Based on the net liabilities at the end of 2016, this credit is expected to be around $10m."

At 0955 GMT, the shares were up 4.3% to 1,000p.