In the latest in a series of consolidation deals in the construction sector, on 2 August
it was announced that Texas-based Jacobs Engineering is to take over rival CH2M in a USD3.3bn cash and shares deal.
The deal, expected to close before the end of the year, would more than double Jacobs’ revenue from its buildings and infrastructure business and give it greater footprint in the public transport market.
The takeover is made up of 60% in cash and 40% in Jacobs stock; the USD3.3bn includes USD416m of CH2M’s net debt. The firm said it will be able to achieve USD150m cost-savings by the end of the second year.
Both engineering firms have significant contracts in the light and urban rail sector; in recent years Jacobs has worked on major LRT programmes in Dallas, Denver, Los Angeles and Chicago, while CH2M has more global references, with contracts on Metrolinx (Ontario), Hyderabad Metro (India), London’s Docklands Light Railway and Crossrail (UK) and the Klang Valley MRT project in Malaysia.