A bidding war for the consultancy behind landmark projects such as the Sydney Harbour Bridge and London’s Tower Bridge is possible following the emergence of Japanese engineering giant Nippon Koei as a rival bidder for the company.
Last week, Nippon unveiled a 680p per share offer for London based design and engineering consultancy Hyder Consulting – 4.6 percent above an earlier 650p bid from Amsterdam based built asset consultancy Arcadis, which was previously considered by some to be a knockout bid.
In a statement, Nippon President Noriaki Hirose said the offer reflected his company’s desire to become a top tier global engineering consultancy, and that the two companies shared complimentary portfolios, a long-standing history in engineering and conservative management styles.
He said confidentiality considerations had been behind the secrecy of Nippon’s interest until now as the company learned more about its target’s capabilities.
“I regret that the confidential nature of our interest has meant we have not yet had the opportunity to meet many of the employees of Hyder and begin planning our combined journey together,” Hirose said.
“We rarely make acquisitions but, having studied Hyder carefully, we are clear how important and strategic this merger is for us.”
A product of a range of mergers and acquisitions – most recently a management buyout in 2001 and subsequent listing on the London Stock Exchange in 2002, Hyder’s history and that of its predecessors goes back two centuries and includes work on iconic projects such as Sydney Harbour Bridge, Tower Bridge in London and Dubai’s Burj Khalifa – the world’s tallest building.
More recent projects in Australia, meanwhile, include CityLink and Federation Square in Melbourne, Sydney Tower and Westpac Place in Sydney and The Wave on the Gold Coast.
Its sectors of coverage appear broadly consistent with those of Nippon Koei (energy, water, transport and urban development and environment), whilst differing geographic footprints including Hyder’s presence in the United Kingdom, Germany and Australia and Nippon’s in Latin America and Africa (both have a reasonably strong presence in Asia and the Middle East) are expected to enable substantial cross-selling opportunities.
Hyder’s directors last week declared the offer – which would value the company at £268.1 million – to be fair and reasonable and recommended shareholders accept.
It is not known whether or not Archadis will come back with a new counter offer.
Hirose says Hyder will continue to operate as a stand-alone business if the Nippon takeover does succeed.