Lendlease declares new A500 mln buyback
Strategy addresses key investor concerns UBS
Shares set for best day since April 2020

May 27 Reuters Australian developer Lendlease will retreat from its overseas construction businesses and free up to A4.5 billion 2.9 billion in capital for shareholders, putting a lid on its international ambitions to shift focus on local operations.

Lendlease will form a new capital release unit CRU, it said in a statement on Monday, with an aim to recycle the A4.5 billion by finishing transactions that are underway.

The construction company said it was targeting A125 million in annual savings within 12 months, and the return of A500 million to shareholders through an onmarket buyback plan.

Lendlease recently faced a lot of backlash from its shareholders who have in the past pressurised the firm to pivot its focus towards Australian operations, resulting in its most notable change since selling the wealth management business to National Australia Bank.

Shares of Lendlease rose nearly 10, set for their best day since April 2020, if gains hold.

The strategy announcement is addressing key investor concerns around the unprofitability of offshore while proposing an orderly exit, UBS analysts said in a note.

Lendlease will book impairments of up to A1.48 billion, write down investments in its overseas projects, but maintained its outlook for return on group equity for fiscal 2024.

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