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  • AMEC: Recommended acquisition of Foster Wheeler AG
    édité le 13/02/2014 - Plus de news de "AMEC" - Voir la fiche entreprise de "AMEC"

AMEC: Recommended acquisition of Foster Wheeler AG
AMEC, the international engineering and project management company, announces that it has entered into a definitive agreement with Foster Wheeler AG (Foster Wheeler) under which AMEC will make a recommended offer to acquire the entire issued and to be issued share capital of Foster Wheeler (the Acquisition).

The terms of the Acquisition are as announced on 13 January 2014, with Foster Wheeler shareholders receiving 0.8998 new AMEC securities and $16.00 in cash for each Foster Wheeler share (representing approximately $3.3 billion, or £2.0 billion, in aggregate, payable approximately 50 per cent in cash and 50 per cent in AMEC securities) (1).

Individual Foster Wheeler shareholders will have the ability, through a mix and match facility, to elect the proportion of cash and securities to be received in the offer. This election will be subject to pro rata adjustment in the event either cash or securities is over-subscribed.

The cash portion of the consideration will be financed by a combination of AMEC’s existing cash resources and new debt financing. The securities portion of the consideration will be satisfied by the issuance of approximately 90 million new AMEC securities to Foster Wheeler shareholders, which, at the election of Foster Wheeler shareholders, will be issued in the form of either ordinary shares or American Depositary Shares (for which AMEC will seek a US listing).

On completion of the Acquisition, Foster Wheeler shareholders will hold shares in AMEC representing approximately 23 per cent of its enlarged share capital and it is expected that two non-executive directors of Foster Wheeler will join the AMEC board.

The implementation agreement prohibits Foster Wheeler from soliciting competing proposals, and from providing information and engaging in discussions with third parties, except in limited circumstances.

Key anticipated benefits of the combination include:

- Positioning AMEC to serve across the whole oil and gas value chain, adding mid and downstream capabilities to AMEC’s existing upstream focus and bringing new customer relationships
- Improved geographic footprint, more than doubling AMEC’s current revenues in the Growth Regions, increasing AMEC’s Latin America exposure and bringing scale benefits
- Annual cost synergies, estimated by AMEC to be at least $75 million, and additional significant tax synergies
- Significant revenue synergies, including cross-selling services to the combined customer base, such as expanding the brownfield and environmental service offering internationally into the mid and downstream markets
- Retaining AMEC’s low-risk and cash generative business model. Foster Wheeler has a similar business model, with predominantly cost-plus contracting and an asset-light engineering and project management business
- Combining two highly skilled workforces with industry-leading engineering and project management expertise
- Adding a robust and profitable power equipment business with a solid backlog of orders.

The Acquisition is expected to be double-digit earnings accretive in the first 12 months following completion, and ROIC is expected to exceed the cost of capital in the second 12 month period following completion. AMEC expects to have a pro-forma trailing 12 months ratio of net debt to EBITDA of approximately 1.6 times following completion.

Commenting on the Acquisition, AMEC Chief Executive, Samir Brikho, said: “I am delighted with today’s announcement of a recommended offer for Foster Wheeler. The combination positions us across the whole oil & gas value chain, provides scale in our Growth Regions and is expected to be double-digit earnings enhancing in the first twelve months. The offer has been unanimously approved by the boards of both companies and is a compelling opportunity for all shareholders, customers and employees.”

Due to its size, the Acquisition is a class 1 transaction under the UK listing rules and therefore requires the approval of AMEC shareholders. Completion of the transaction will also be subject to AMEC having received valid acceptance to the offer from holders of Foster Wheeler shares holding a minimum of 80 per cent of the total issued share capital of Foster Wheeler, regulatory and anti-trust approvals, a Foster Wheeler shareholder vote, and the satisfaction of other customary closing conditions.

The Acquisition is expected to close in the second half of 2014.

Bank of America Merrill Lynch is acting as exclusive financial adviser to AMEC. Bank of America Merrill Lynch and Barclays are joint corporate brokers to AMEC.
(1) Calculated using the AMEC share price of 1092p and a pound sterling to US$ exchange rate of 1:1.658, both as at the close on 12 February 2014. The recommended offer value has been calculated using a Foster Wheeler diluted share count of approximately 99.9 million shares (based on treasury share method) that will be settled in new AMEC securities and cash, plus approximately 1.2 million of shares currently in Foster Wheeler award schemes that are expected to be rolled into new AMEC awards.

About AMEC

AMEC is a focused supplier of consultancy, engineering and project management services to its customers in the world's oil and gas, mining, clean energy, environment and infrastructure markets. With annual revenues of some £4 billion, AMEC designs, delivers and maintains strategic and complex assets and employs around 29,000 people in more than 40 countries worldwide.

About Foster Wheeler

Foster Wheeler (Nasdaq:FWLT) is a global engineering and construction company and power equipment supplier delivering technically advanced, reliable facilities and equipment. The Company employs approximately 13,000 talented professionals with specialized expertise dedicated to serving its clients through one of its two primary business groups. The Company’s Global Engineering and Construction Group designs and constructs leading-edge processing facilities for the upstream oil and gas, LNG and gas-to-liquids, refining, chemicals and petrochemicals, power, minerals and metals, environmental, pharmaceuticals, biotechnology and healthcare industries. The Company’s Global Power Group is a world leader in combustion and steam generation technology that designs, manufactures and erects steam generating and auxiliary equipment for power stations and industrial facilities and also provides a wide range of aftermarket services. The Company is based in Zug, Switzerland, and its operational headquarters office is in Reading, United Kingdom.

Origine : Communiqué AMEC

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