Carillion takes Eaga for £306m
Construction giant Carillion, based in Wolverhampton, has acquired outsourcing company Eaga in a deal worth more than £300m. The boards of the two companies announced the buyout on the London Stock Exchange this morning, where Carillion said it expected the purchase to generate combined revenues in excess of £3bn per year.
Newcastle-based Eaga was bought for a total consideration of £306.5m. The company provides residential energy efficiency solutions across the UK.
A deal was agreed valuing Eaga at 120p per share, with a 40 per cent share alternative valuing new Carillion shares at 385.2p.
Philip Rogerson, chairman of Carillion, said: "The acquisition brings together two complementary companies, enhancing Carillion's position as one of the UK's leading support services companies. The acquisition is expected to be immediately earnings enhancing and builds on Carillion's previously announced objectives for growth.
“Carillion has identified the low carbon market as a strategic area of growth and the acquisition of Eaga will create a scalable platform to build the UK's largest independent energy services provider. This will also extend Carillion's capability to provide integrated support services solutions for its existing customers, for whom energy services are an increasingly important requirement.
“The Carillion board is therefore confident that this transaction will deliver significant value for shareholders of the enlarged group.”
Charles Berry, chairman of Eaga, said the offer had come at “an interesting time in Eaga's development, as our markets are changing rapidly”. He added that “exciting” future prospects would be better accessed “as part of a larger group”.
The acquisition is subject to approval by shareholders of Eaga, change of control approval from the FSA and confirmation by the court. It is expected to become effective in April 2011.
Lazard is acting as financial adviser to Carillion. Morgan Stanley & Co. International plc and Oriel Securities are acting as joint corporate brokers to Carillion.
J.P. Morgan Cazenove is acting as lead financial adviser and joint corporate broker to Eaga. Noble Grossart is acting as financial adviser and Brewin Dolphin is acting as joint corporate broker to Eaga.
