Technip SA (TEC.PA,TKPPY.PK), a French operator of gas and oil engineering, technologies and projects, announced Monday that it has entered into an agreement to acquire Stone & Webster process technologies and the associated oil and gas engineering capabilities from The Shaw Group (SHAW) for a cash consideration of approximately EUR 225 million.
The business operates from five main locations with a particularly strong presence in the US (Houston, Texas, along with Cambridge and Weymouth, Massachusetts), in the UK (Milton Keynes) and in India (Mumbai).
The acquisition is expected to close during the second half of 2012. Technipsaid it plans to integrate rapidly and to take the majority of an estimated EUR 15 million of transaction and transition costs this year.
Technip stated that the acquisition will be consolidated for only a few months and, excluding the one-off costs, there will therefore be no material impact on Technip's revenue and operating profit this year. On this basis, Technip's 2012 financial objectives are unchanged.
The transition costs will drive cost synergies, notably in the areas of premises and IT, of around EUR 7 million on an annualized basis from around a year after close.
The cash consideration of around EUR 225 million will be paid out of Technip's existing cash resources. The transaction is subject to customary price adjustment and closing conditions, including regulatory approvals.
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