Canada’s WSP Global is “considering its options” after its £591 million acquisition of UK-based environmental consulting firm RPS Group was trumped by Tetra Tech.
Montreal-headquartered WSP said “a further announcement will be made … in due course”.
Tetra Tech lobbed its £636m offer for RPS last week. The California-based engineering consulting group said it had arranged US$1150m of finance, including a $350m Bank of America credit facility, indicating it believes its 222p-a-share RPS bid might not be the last round in the battle for control of the company.
“The acquisition is expected to be mid-to-high-teen-percent accretive to adjusted earnings per share after realising the full benefit from an expected £21 million in cost synergies and integration into Tetra Tech,” the US company said.
“The cost to realise these synergies is estimated to be £16 million and would be substantially incurred in first 12 months after closing. Adjusted EPS excludes one-time transaction related costs and intangible amortisation.”
Nasdaq-listed Tetra Tech said its offer was unanimously recommended by the RPS board.
“The combined 26,000 associates of the RPS Group and Tetra Tech will establish a premier global consultancy in water, environment, sustainable infrastructure, and energy transformation,” it said.
RPS employs 5000 associates in Europe, the United Kingdom, Asia Pacific, and North America, “delivering high-end solutions especially in energy transformation, water, and program management for government and commercial clients”.
“The RPS Group significantly expands Tetra Tech’s water practice in the United Kingdom, and enhances Tetra Tech’s leading position in renewable energy and environmental management,” Tetra Tech said.
“The combination further strengthens our geographic presence in the United Kingdom, European Union, and Australia.”