Jacobs Engineering Acquires CH2M Hill for $3.27 Billion

It is a cash and stock transaction with an enterprise value of approximately $3.27 billion, including approximately $416 million of CH2M net debt, the companies announced Aug. 2.

Dallas-based Jacobs Engineering Group Inc. has agreed to acquire all of Englewood, Colo.-based CH2M HILL Companies Ltd.'s outstanding shares in a cash and stock transaction with an enterprise value of approximately $3.27 billion, including approximately $416 million of CH2M net debt, the companies announced Aug. 2. They said the combination unites two industry-leading innovative companies with complementary capabilities, cultures, and relationships.

With trailing 12-month revenues of $4.4 billion and 20,000 employees, CH2M is a renowned design, engineering, and program management firm, "and is a leader in key infrastructure and government service sectors that Jacobs has previously targeted for growth, including water, transportation, environmental and nuclear," their announcement said.

"By increasing our industry reach and adding to our already extensive skills, this transaction enhances our value to our clients and bolsters Jacobs' position as a premier consulting, design, engineering, construction, and operations and maintenance technical services firm. CH2M brings to Jacobs a talented, engaged team with capabilities and values that are very complementary to our own. Together, we will bring more solutions to our clients, give more opportunity to our employees, and create increased value for Jacobs' shareholders. In addition, this transaction is consistent with our M&A criteria, accelerating our ability to achieve our financial growth targets and propelling Jacobs toward our vision of providing innovative solutions for a more connected, sustainable world," said Steve Demetriou, Jacobs' chairman and CEO.

"We are delighted about the prospects of combining CH2M with Jacobs," said CH2M Chairman and CEO Jacqueline Hinman. "Since late 2014, we've been transparent about our plans to pursue an ownership transition, providing sustained access to capital for growth. Considering all of the options, we focused on securing greater opportunities for our employees, delivering superior value to our clients and enhanced value for our stockholders, all while continuing to serve the higher purpose our company is known for -- providing sustainable solutions for a better world. Throughout this time, we strengthened our business portfolio and performance, which put us in a position to deliver the best possible value and outcome for the future of the company. This was the unanimous choice of our board, and the value Jacobs will provide to our stockholders reflects genuine appreciation for our employees and the world-class work we deliver to our clients."

CH2M is considered a leading water design firm, while Jacobs is a leader in transportation. They said Jacobs expects to achieve $150 million of annual run-rate cost savings by the end of the second year following the close of the transaction. "Savings are expected to come from real estate, optimization of corporate operations, alignment of organizational structures, procurement and IT systems," savings for which Jacobs expects to incur approximately $225 million in one-time costs to achieve.

The transaction is expected to close in Jacobs' fiscal 2018 first quarter, subject to regulatory approvals and approval by CH2M stockholders. Apollo Global Management, LLC, which has an approximate 18 percent voting interest in CH2M, has agreed to vote in favor of the transaction.

Download Center

HTML - No Current Item Deck
  • Free Safety Management Software Demo

    IndustrySafe Safety Management Software helps organizations to improve safety by providing a comprehensive toolset of software modules to help businesses identify trouble spots; reduce claims, lost days, OSHA fines; and more.

  • Complete Online Safety Training Courses

    Deliver state-of-the art, online safety training courses to your organization with IndustrySafe Training Management Software. Generate reports to track training compliance and automatically notify learners of upcoming or overdue classes.

  • Easy to Use Safety Inspection App

    Conduct inspections on the go with IndustrySafe’s mobile app. Complete safety audits at job sites and remote locations—with or without web access.

  • Track Key Safety Performance Indicators

    IndustrySafe’s Dashboard Module allows organizations to easily track safety KPIs and metrics. Gain increased visibility into your business’ operations and safety data.

  • Analyze Incident Data and Maintain OSHA Compliance

    Collect relevant incident data, analyze trends, and generate accurate regulatory reports, including OSHA 300, 300A, and 301 logs, through IndustrySafe’s extensive incident reporting and investigation module.

  • Industry Safe
comments powered by Disqus