SKANSKA is reported to be selling its Darlington subsidiary Whessoe to The Shaw Group.

The US engineering operation is believed to be in exclusive negotiations with Skanska and hopes to agree the deal in March.

Whessoe, which has 200 staff, specialises in building tanks and terminals for the liquid natural gas (LNG) sector.

Last year, it won an £80m contract from National Grid Transco to build an importation centre on the Isle of Grain, in the Thames Estuary.

It is understood that Skanska is selling the business as part of its strategy of concentrating on core building and civil engineering markets.

The company inherited Whessoe, led by managing director Jon Dale, when it bought Kvaerner in August 2000.

No one from either Skanska or the Shaw Group would comment on the sale.

It is not yet known how much the deal would be worth.