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MELBOURNE / NEW YORK (Reuters) – American company Jacobs Engineering Group Inc. (JEC.N) agreed to sell its energy, chemicals and resources business to WorleyParsons (WOR.AX) for $ 3.3 billion, in an agreement that will double the size of the Australian engineering services company.
The agreement continues the restructuring of the engineering services sector, following the purchase of its competitor CH2M Hill Cos Ltd for $ 3.3 billion by Jacobs and the acquisition of Amec Foster Wheeler by the company oil services company John Wood, for 2.2 billion pounds
WorleyParsons is emerging from a three-year slowdown as a result of falling oil prices and is well positioned to capitalize on the growth of the refining and petrochemical sectors, as countries building new factories in India gigantic.
"Hydrocarbons, minerals and metals are plummeting and are well below their 2013 highs. We think the industry is an exciting time," WorleyParsons general manager Andrew Wood told teleconferences. .
Jacobs, NASA's largest space program service provider, said its activities would now be focused on the fastest-growing, high-margin sectors, including aerospace, technology and nuclear, as well as buildings and infrastructure.
The acquisition would position WorleyParsons as the world's leading provider of professional services in the energy and resource sectors, with a significant presence in Europe and North America, further expanding its presence in the Middle East and Asia.
The transaction will also expand its exposure to the refining and petrochemicals sectors, which, according to Wood, was attractive because the revenue streams are less volatile than oil and gas exploration and production, where WorleyParsons is already a leader.
The transaction would double the company's profit for 2018 before interest, taxes, depreciation and amortization (EBITDA) to A $ 735 million ($ 523 million) and increase earnings per share by 50% after achieving savings of $ 130 million. Australian dollars. I said.
Jacobs said he would receive $ 2.6 billion in cash plus $ 700 million in shares, which would give him an 11 percent stake in the expanded WorleyParsons.
"For Jacobs, this transaction marks a turning point in the transformation of our portfolio into a more consistent, higher margin growth as a leader in addressing the critical challenges of the world," said Steve Demetriou, President and CEO of Jacobs. in a statement.
The transaction has been approved by both boards of directors and is expected to close in the first half of 2019.
WorleyParsons plans to finance the deal through a $ 2.9 billion Australian offering, a share issue for Jacobs and a new debt.
The price of the show to Jacobs will be 16.92 Australian dollars per share. The remainder of the offer would cost A $ 15.56 per share, a 13% discount on WorleyParsons' closing last Friday. The founder and president of WorleyParsons, John Grill, the company's second largest shareholder, will receive $ A100 million.
UBS, which advised WorleyParsons in the transaction, is the lead co-director with Macquarie Capital at the sale of the shares.
Perella Weinberg Partners LP is the financial advisor to Jacobs.
Report by Sonali Paul and Jessica Resnick-Ault; edited by Sandra Maler and Richard Pullin
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