DALLAS & DENVER, US - Two global engineering consultancy giants are set to join forces in a merger set to exceed the $3 billion mark.
Jacobs Engineering Group will acquire all of the outstanding shares of CH2M in a cash and stock transaction worth approximately $3.27 billion, including approximately $416 million of CH2M net debt.
As well as sectors such as transport and petroleum, the joined companies believe they can collectively gain a leading position in the water market.
Jacobs will offer CH2M’s capabilities - including desalination and wastewater reuse infrastructure - to its clients in the water sector, which the companies estimate to be worth $100 billion, growing 4 to 5 percent annually.
An integration and management office from Jacobs will oversee the merge between the two companies, including CH2M’s 20,000 employees and $4.4 billion trailing twelve month revenues.
Following the merger, Jacobs said it expects to achieve $150 million of annual run-rate cost savings by the end of the second year, through an “alignment of organizational structures”.
Steve Demetriou, chairman and CEO of Jacobs, said: “By increasing our industry reach and adding to our already extensive skills, this transaction enhances our value to our clients and bolsters Jacobs’ position as a premier consulting, design, engineering, construction, and operations and maintenance technical services firm.”
Jacqueline Hinman, CEO and chairman, said: “Since late 2014, we’ve been transparent about our plans to pursue an ownership transition, providing sustained access to capital for growth. Considering all of the options, we focused on securing greater opportunities for our employees, delivering superior value to our clients and enhanced value for our stockholders, all while continuing to serve the higher purpose our company is known for, providing sustainable solutions for a better world.”
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