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Amec says offers to buy Foster Wheeler in USD3 bln deal

January 14/2014

MOSCOW (MRC) - British engineering firm Amec said on Monday it had provisionally agreed to buy Foster Wheeler in a cash and share deal that values the Swiss-based engineer at 1.9 billion pounds (USD3.13 billion), said Reuters.

Amec said the deal would improve its geographical footprint by more than doubling its revenues in faster-growing regions, and would add mid and downstream capabilities to its existing upstream focus.

Under the offer terms, Amec said Foster Wheeler shareholders would receive approximately 0.9 Amec shares and USD16 in cash, representing USD32 for each Foster Wheeler share. Shares in Foster Wheeler closed at USD31.46 on Friday.

Should the deal complete, Foster Wheeler will hold shares in Amec representing 23% of the enlarged company, and Amec would seek a U.S. listing in connection with the transaction, the companies said.

Foster Wheeler said it had agreed with Amec not to solicit alternative proposals up to Feb. 22, and would pay out a one-time dividend of USD0.40 per share prior to closing should the companies close the deal. Amec said the cash component of the offer, USD1.595 billion, will be financed by its existing cash resources and new debt financing.

Amec, which has a market capitalisation of 3.21 billion pounds and provides services and equipment for the oil, gas and mining sectors, has been on the hunt for acquisitions, and media reports last year suggested that it was interested in Foster Wheeler.

As MRC wrote before, Foster Wheeler has been selected by Rosneft and ExxonMobil to undertake the initial phase of the front-end engineering design (FEED) for a proposed Russian Far East liquefied natural gas (LNG) project. Foster Wheeler is one of two companies to be awarded separate contracts for the initial FEED work prior to selection of a single contractor for the second FEED phase.


mrcplast.com
Author:Anna Larionova
Tags:neftehimiya, Rosneft, Exxon Mobil.
Category:General News
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