Contractor Ballast has cut its links with its Dutch parent company to go it alone.
It has put in place independent funding arrangements allowing it to run as a separate entity from Ballast Nedam. This is in line with the parent company's move away from the British market.

Ballast has had a "for sale" sign above it since the middle of last year. Ballast Nedam has also been seeking buyers, and is now in talks with a Dutch finance group.

Ballast said it expected to return to profitability next year after making a loss of £32m in the first half of last year.

Since then, the company's loss-making southern divisions have been drastically scaled back. They are now have about one-quarter of their previous turnover.

Parent company Ballast Nedam said it expected to post a loss of up to £99m in its 2002 annual results, due to be presented in March. This is about £30m higher than the prediction made in its interim results.

About £26m of the additional loss was caused by an unexpected shortfall in the company's pension fund.

In a statement, Ballast Nedam said: "Because of the decreased value of its investments in equity, the fund is under-funded."

Ballast Nedam was approached by a Dutch finance group last weekend. The construction company said the offer was being reviewed by its management.