Nippon Koei UK drops out of the race to acquire Hyder Consulting
THE path for Dutch group Arcadis to acquire design and engineering consultancy Hyder Consulting, which has an office in Birmingham, appears to have been cleared after a rival bidder dropped out of the race.
Nippon Koei UK Topco, a wholly-owned subsidiary of Nippon Koei Co had submitted a counter-offer to the one originally proposed by Arcadis.
The Dutch firm, still keen to secure its prize increased its offer and supported its case with the acquisition of additional shares in the Hyder business.
The acquisition of the additional 3,734,808 Hyder shares, secured in a deal with a single shareholder, represented approximately 9.6% of Hyder’s existing share capital.
The move appears to have been the straw that broke Nippon’s back.
In a statement to the London Stock Exchange it confirmed it was withdrawing its offer for the consultancy.
Noriaki Hirose, President of Nippon Koei, said: “Nippon Koei’s strategy is focused on broadening our geographic footprint and client base while providing ongoing strong customer service and delivery. While Hyder represents an attractive fit with Nippon Koei, and is clearly an excellent company, an acquisition at the current valuation level would present challenges to value enhancement for us, not least as our offer envisaged Hyder continuing to operate as a standalone division of the combined business.
“We understand and regret the impact of a process such as this on the employees and customers of Hyder in particular, and wished to make it clear that we will not proceed with the acquisition now in order to minimise the ongoing uncertainty. We wish the management and employees of Hyder all the best in the future.
“Nippon Koei retains its strategic vision to become a top tier global engineering consultancy and we will continue to investigate potential merger partners to assist us in achieving that aim.”
Arcadis and its wholly-owned subsidiary AUK Investments, have now acquired, agreed to acquire or received undertakings for 10,979,887 Hyder shares, representing around 28.2% of Hyder’s issued share capital.
Its revised offer, made through AUK, to acquire the outstanding share capital is based on a price of 750p per share.
This values the entire issued and to be issued ordinary share capital of Hyder at approximately £296m which represents a premium of approximately 59.8% to the closing price of 469p on July 30, 2014, the latest date prior to the start of the offer period.
Details of the offer are currently with Hyder shareholders.
Approval of the Arcadis offer will be sought at a general meeting of Hyder shareholders, which is set to take place at the London offices of Wragge Lawrence Graham & Co on September 25.
