Balfour Beatty has acquired Yorkshire-based utility group Kentons for £28m.
Mike Welton, chief executive of Balfour Beatty, said the move would strengthen the group's infrastructure businesses. He said: "We believe this market will continue to grow as customers respond to the need to upgrade and enhance their existing systems and to outsource an increasing range of services."

Most large contractors have made acquisitions in the past two years to tap into this market.

Kentons, which employs 1200 staff, is expected to have a turnover of £65m in the year to 30 April and operating profit of £4.4m. It provides new connection, rehabilitation, and the repair and maintenance of clean water, wastewater and gas networks.

Kentons' clients include Transco, Yorkshire Water, Northumbrian Water, United Utilities, the Scottish water authorities and Mid-Kent Water.