Deal with strengthen WSP’s workforce and reach in several markets
WSP is to acquire consultancy firm Louis Berger in a deal worth $400m. Through the deal, Louis Berger will add 5,000 people to WSP’s workforce mainly in the US, and will grow the company’s reach in Spain, France, the Middle East and Latin America.
According to a statement from WSP, the deal will be financed by an underwritten term loan from Canadian Imperial Bank of Commerce (CIBC), as the sole lead arranger and sole bookrunner.
70% of Louis Berger’s 2018 net revenues excluding disaster response revenues came from its US operations. Its portfolio includes landmarks such as the Lincoln Memorial Reflecting Pool, the Statue of Liberty, the George Washington Bridge and World Trade Center. More recently, the firm has been providing emergency management services for temporary power in Puerto Rico since Hurricane Maria.
As part of a joint venture, Louis Berger is also providing project management services to build a metro system and oversee the construction of three stadiums in the region.
“We are pleased by the opportunity to have Louis Berger join WSP. The company is recognised for its expertise in sectors and services that WSP had targeted for growth, including water, environment (including emergency management) and transportation (including ports and marine), as well as master planning. This acquisition will also enable us to increase our presence in geographies we have previously targeted for growth, such as continental Europe. Lastly, it will increase our exposure to the US Federal sector since Louis Berger has developed expertise and built experience in governmental contracts (including federal military and economic and institutional development),” said WSP President and CEO Alexandre L’Heureux.
In connection with US compliance DOJ monitorship of its international divisions instituted in 2015 (which monitorship has been terminated), Louis Berger began restructuring its international operations. WSP says it intends to continue the restructuring and could incur approximately $50m in one-time integration and restructuring costs in the coming years.
Louis Berger CEO Jim Stamatis commented, “I am very pleased about the prospect of joining WSP, as our values and strategies are aligned and our operations are complementary. This will create new opportunities for our employees and clients. WSP and Louis Berger are known to each other as we have pursued and won many projects together and as a result, we feel very comfortable in the strategic and cultural fit as we join together. As we have just completed our monitorship with the US Government, our most successful year in the company’s history, and continued simplification and restructuring of our operations, this presented an optimal time for us to transition to a new chapter in our evolution.”