LONDON (Reuters) - British infrastructure group Balfour Beatty (>> Balfour Beatty plc) has rejected a 1 billion pound offer from John Laing Infrastructure Fund (JLIF) for assets it operates in partnership with government, saying the price was too low.

The offer comes amid troubled times at Balfour, which has issued a string of profit warnings, and been forced to fend off takeover approaches from rival Carillion (>> Carillion plc).

The non-binding proposal from JLIF (>> John Laing Infrastructure Fund Ld), an investor in hospitals, roads and schools, was made on Monday.

Balfour said on Friday it fell significantly short of its own valuation of the portfolio.

Responding in a statement, JLIF questioned the basis of Balfour's valuation, calling it "overly optimistic".

Balfour said earlier it intended to publish an updated valuation of the assets in January, which would take into account recent contract wins, plus further investments and disposals.

"JLIF awaits with interest another revised valuation of the portfolio from Balfour Beatty and in the meantime will continue to evaluate all other options for unlocking the portfolio," JLIF said in its statement, without elaborating.

"A further announcement will be made if and when appropriate," it said.

So-called public-private partnerships can be attractive to infrastructure companies because of their steady income steams.

Balfour had already in August increased the valuation of the portfolio by 46 percent to 1.05 billion pounds, in part reflecting Britain's economic recovery.

It said on Friday the future strength of the market meant its actual value was "substantially in excess" of that figure.

Balfour's stock, down 32 percent in the year to date, closed up 5.9 percent at 195.6 pence, valuing the business at over 1.3 billion pounds.

Investec analysts said JLIF's bid looked "tempting" given that it would provide Balfour with firepower that it may need to fund its recovery.

"Whilst there is turnaround potential in Balfour Beatty, this is set to be a long and drawn out process, with the likely cost of restructuring an unwelcome surprise about to emerge on the horizon," they said in a note.

The company is counting on Leo Quinn, due to join as its new chief executive from defence firm QinetiQ's (>> QinetiQ Group plc) on Jan. 1, to lead a turnaround.

It also said on Friday key findings from a review by accountancy firm KPMG of its struggling British construction business were expected to be announced in late January.

(Editing by Jane Merriman and Mark Potter)

By Neil Maidment and Sarah Young