Lavalin To Buy UK-Based WS Atkins For $2.7 Billion

Paterniano Del Favero
Aprile 23, 2017

Global design, engineering and project management consultancy Atkins, which operates from more than 40 offices across the United Kingdom, has agreed to the terms of a takeover offer which values the listed business at more than £2bn.

In early April it was announced that the Canadian engineering and construction group had offered to take over Atkins for GBP 20.8 (USD 25.86/EUR 24.27) per share in cash.

Subject to approval by Atkins shareholders, who are being recommended to accept the offer by the board, the acquisition is expected to become effective during Quarter 3 of 2017.

The deal will create a C$12.1bn global professional services and project management company with 53,000 employees.

SNC-Lavalin, based in Montreal, Canada, said April 20 it agreed to acquire Atkins for about C$3.6 billion (US$2.7 billion) in cash.

When the deal is completed, Uwe Krueger will step down as Atkins CEO and director, although he and SNC-Lavalin are set to "discuss putting in place a transitional services agreement", says the intended new parent.

SNC-Lavalin says the purchase will bring "new and complementary capabilities in three of its four business sectors with essentially no overlap in its service offering".

The company added: "SNC-Lavalin attaches great importance to the skills and experienceof the existing management and employees of Atkins and believes that they will benefit from enhanced career and business opportunities within the Combined Entity". However chief financial officer Heath Drewett is understood to have been offered the role of head of Atkins within the combined entity.

On top of any cross-selling benefits and increased geographical reach, SNC-Lavalin anticipates delivering annual cost synergies of around CAD120.0 million by the end of 2018 - split CAD90.0 million from WS Atkins and CAD30.0 million from SNC-Lavalin.

"This acquisition is fully aligned with our stated growth strategy of becoming a recognized global E&C powerhouse", SNC-Lavalin CEO Neil Bruce said in a conference call after markets closed.

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