Canada's SNC-Lavalin Swoops on U.K. Rival Atkins in £2.1 Billion Deal

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--U.K. engineering and construction consultancy firm Atkins (Aberdeen, Scotland) has agreed to a £2.1 billion ($2.7 billion) takeover offer from Canadian rival SNC-Lavalin Constructors Incorporated (TSX:SNC) (Montreal, Quebec).

SNC-Lavalin is a leading engineering, procurement and construction (EPC) firm has succeeded in its bid just months after Atkins was reportedly in talks with U.S. firm CH2M Hill (Denver, Colorado). Atkins' Chief Executive Officer Uwe Krueger hinted to media in February that a merger might be the best way for the company to grow globally.

SNC-Lavalin has agreed to pay £20.80 in cash for each Atkins share, a 35% premium on top of the company's share price at the end of March. The deal will create an $8.9 billion global fully integrated professional services and project management company with 53,000 employees.

Industrial Info reported recently that it is tracking $113 billion in active projects involving SNC-Lavalin, spanning industries such as onshore and offshore oil production, hydropower, nuclear and natural gas. For additional information, see April 11, 2017, article - SNC-Lavalin Adds ExxonMobil Offshore-Drilling Venture to $113 Billion in EPC Projects.

The deal gives Atkins--which has around half of its business in the U.K.--a route into new U.S. and global markets. Atkins was heavily involved with the 2012 London Olympics, the Aberdeen oil and gas industry, the current Hinkley Point C nuclear power project and the Crossrail transport project in London.

"We believe that the offer from SNC-Lavalin represents an attractive and certain value in cash today for Atkins shareholders, reflecting the high quality of the business, its people and its future prospects," commented Allan Cook, Chairman of Atkins. The Board of Atkins believes that a combination will provide clear benefits to our shareholders, enhanced opportunities for our employees as part of a larger group, and a broader service offering for our customers."

Neil Bruce, president and chief executive officer of SNC-Lavalin, added: "We are very pleased to announce this proposed acquisition that is fully aligned with our growth strategy, creating a global fully integrated professional services and project management company--including capital investment, consulting, design, engineering, construction, sustaining capital and operations and maintenance. It also creates new revenue growth opportunities in key geographies by positioning us to capitalise on increased cross-selling, and the opportunity to win and deliver major projects in new regions."

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