Aecom buys URS to create £11bn turnover firm
Aecom has announced it will buy engineering consultancy URS Corporation for US$4bn (£2.3bn).
The combined company will have 95,000 employees across 150 countries, and would have a 2013 turnover of $19bn (£11bn).
Aecom will acquire all outstanding shares of URS for a combination of cash and stock valued at $56.31 (£32.89) per URS share. Including the acqusition of URS debt, the deal is worth more than $6bn (£3.51bn).
By acquiring URS, Aecom said it will gain capabilities in the construction, oil and gas, power, and government services and improve its integrated delivery model.
Aecom said it expected to save $250m (£145.6m) through merging the groups by the end of 2016.
Among the UK contracts awarded to URS this year has been the appointment of a Flint & Neill and URS design joint venture to deliver detailed design consultancy services for the £600m Mersey Gateway Bridge scheme.
Aecom last year added Lend Lease’s Russian operations to its business. It announced the addition of Madrid-based ACE International Consultants to its international development team earlier this month. It scrapped the Davis Langdon brand last year having bought it in 2010.
Aecom president and chief executive Michael S. Burke said: “The combination of Aecom and URS creates an industry leader with unsurpassed capacity to deliver integrated solutions across Aecom’s existing markets.
“We will have the ability to design and deliver major civil infrastructure projects in sectors such as transportation and water. In addition, we expect to seize opportunities to more broadly leverage our direct investment vehicle, Aecom Capital.”
Reuters reported Mr Burke as saying that the idea for the acquisition had come following “a courtesy visit to URS after he was appointed chief executive in March” when he met with URS chief executive Martin Koffel.
“While we’ve been competitors in certain aspects, we quickly realized that the two of us were much more complementary that we had originally envisioned,” Mr Burke said, according to Reuters.
Mr Koffel said: “This is a compelling strategic combination that we believe will benefit our clients, stockholders and employees.
“URS stockholders will receive significant, immediate value from the transaction and will be able to participate in the future prospects of the combined company, which we expect will be better positioned to compete for major, complex projects across a diverse range of end markets and geographic regions.”
Aecom is a finalist in this year’s Construction News Awards 2014, to take place on Thursday.