Japan's Nippon Koei trumps Arcadis in Hyder takeover tussle (updated)

Integrated Design & Engineering Holdings Co

08/08/2014 09:25

(Adds analyst comments, shares) 
    LONDON, Aug 8 (Reuters) - British engineering firm Hyder 
Consulting  HYC.L  has accepted a 268 million pound ($451 
million) takeover offer from Japan's Nippon Koei  1954.T , just 
days after recommending a bid from Dutch firm Arcadis  ARDS.AS . 
    Hyder and Nippon Koei said in a joint statement on Friday 
that the recommended cash offer would entitle Hyder shareholders 
to receive 680 pence in cash for each Hyder share, a 30 pence 
premium to an offer from Arcadis last week. 
    Hyder had accepted the bid from Dutch engineering group 
Arcadis, which was prepared to pay 650 pence per share for 
Hyder, in an offer valued at 256.2 million pounds. 
    Shares in Hyder have risen 35 percent since Arcadis made its 
offer last Thursday, and were up 8.7 percent at 701 pence by 
0811 GMT, signalling investors hope for an even higher bid. 
    Arcadis said in a statement it would consider its options 
and make an announcement in due course, with analysts at Liberum 
suggesting another twist could emerge. 
    "While we mistakenly called the previous bid 'likely a 
knock-out', we are not sure that this one is! There is the 
possibility that Arcadis returns, or that a new bidder emerges," 
they wrote in a note. 
    A tie-up between Hyder and Nippon Koei would create a 
company with a market capitalisation of $863.6 million. 
    Nippon Koei said the deal represented a 44.9 percent premium 
to Hyder's shares on July 30 and a enterprise value to EBITDA 
(earnings before interest, tax, depreciation and amortisation) 
multiple of 11.7 times.  
    The Japanese consulting firm, which provides engineering 
services in Japan, Asia, Africa, Latin America and the Middle 
East, also said Hyder would continue to operate as a standalone 
division of the combined business and that operational changes 
to the company would be minimal. 
    "Consolidation has been a sector theme for a number of years 
and this event highlights the value that exists within the 
sector," said N+1 Singer analyst Andy Brown.  
    ($1 = 0.5948 British Pounds) 
 
 (Reporting by Li-mei Hoang; Editing by Neil Maidment and Mark 
Potter) 
 ((neil.maidment@thomsonreuters.com)(+44 0207 542 2292)(Reuters 
Messaging: neil.maidment.thomsonreuters.com@reuters.net)) 
 
Keywords: HYDER CONSULTING NIPPON KOEI/MERGERS