Construction

Arcadis bids to acquire Hyder Consulting for $433.4 million

Hyder shares valued at a 40% premium price of 650 pence per share

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Arcadis, the Dutch engineering consultancy which owns the project management arm of E C Harris, has launched a takeover bid for Hyder Consulting. The Dutch firm estimates a pro forma increase of $408.20 million in net revenues of the combined operations between both firms.

Worth $433.4 million, the takeover bid by Arcadis values Hyder’s shares at 650 pence, which is a 40% premium on the average price of the shares during the three-month run-up period to the bid offer being made.

A proposal offering Hyder’s acquisition was drafted by Arcadis’ chief executive Neil McArthur; chief financial officer Renier Vree; and Ivor Catto, chief executive of Hyder.

In the proposal, Arcadis said the merger with Hyder will “strengthen our D&E (design and engineering) across all our business lines.”

The proposal estimates a pro forma increase of $408.20 million in the net revenue of Arcadis + Hyder. Arcadis’ individual net revenue is $2.5 billion; the pro forma net revenue of Arcadis and Hyder amounts to $2.9 billion (€2.1 billion/£1.7 billion.)

“Arcadis’ recommended cash offer represents a significant premium to Hyder’s current share price,” said. “Although the Board believes that Hyder has a strong future as an independent business, it considers that this cash offer substantially recognises Hyder’s growth prospects, and provides certainty, in cash, to our shareholders today.

“The resultant group should also provide further opportunities for our highly valued clients and staff,” Catto said.

Arcadis said there is a “compelling strategic rationale” behind the bid, and that “the acquisition of Hyder is a natural step in the evolution of Arcadis.”

Hyder, which has worked on projects such as the Burj Khalifa and Emirates Towers in the UAE, and is involved in infrastructure projects across Saudi Arabia and Qatar, has reportedly recommended the bid to its shareholders.

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