Canadian engineer WSP Global yesterday announced the acquisition of fellow Canadian consultant Golder Associates for US$1.1bn.
Golder, based in Mississauga, Ontario, is an employee-owned engineering and consulting firm specialising in environmental and ground engineering, mostly in the mining, manufacturing, oil and gas and infrastructure sectors. It has 155 offices with some 7,000 employees across more than 30 countries.â€ƒ
Alexandre L’Heureux, the chief executive of WSP, said in a press statement that the takeover would allow WSP to create "the leading global environmental consulting firm, with 14,000 of our 54,000 professionals dedicated to accelerating the world’s green transition".
He added: "The combination ideally positions WSP to capitalise on the rapidly growing environmental, social and corporate governance trends driving demand for environmental services and sustainable infrastructure development."
Hisham Mahmoud, his opposite number at Golder, said the deal would combine his company’s expertise with WSP’s "impressive world-class platform".
The deal, which is expected to achieve "cost synergies" of $35m over two years, is being financed by a US$960m bank loan, together with $240m in subscription receipts from WSP’s shareholders and a $200m investment from GIC Private Limited, Singapore’s sovereign wealth fund. Institutional investor British Columbia Investment Management Corporation, contributed another $40m.
The acquisition is expected to be completed in the second quarter of 2021, and is conditional on the approval of more than 75% of Golder’s shareholders, who are due to meet and consider WSP’s offer on 13 January.
As 99% of Golder’s shareholders have already supported the agreement, this is expected to be a formality, although there is always the possibility of a rival offer being made before then. If this is the case, and Golder’s shareholders prefer it, the company will pay WSP a $25m exit fee.
Image: One of Golder’s recent projects was the new runway at Brisbane airport (J Brew/CC BY-SA 2.0)