ARCADIS to Merge With Malcolm Pirnie
Merger expected to create a stronger position in the global water market
ARCADIS announced June 25 that it has signed a merger agreement to acquire 100% of the shares of Malcolm Pirnie, a White Plains, N.Y.-based company predominantly active in water and environmental consulting and engineering, currently owned by about 80 internal shareholders. At closing, Malcolm Pirnie will be a wholly-owned subsidiary of ARCADIS U.S.
ARCADIS will finance this merger by issuing 5.74 million shares to present Malcolm Pirnie shareholders and key employees, in addition to a cash amount of $135 million, for which ARCADIS has secured a new debt facility from Rabobank, ING and RBS.
The merger is contingent on Malcolm Pirnie shareholder approval and related closing requirements. It is anticipated that the merger will be completed in July 2009. The major shareholders comprising ownership of 48% of the outstanding shares have provided irrevocable support of the merger.
The combination of both companies is expected to generate significant business and operational synergies.
Malcolm Pirnie brings an established world-class water brand, with specializations in water quality, treatment, strategic planning and project delivery. Combined with ARCADIS' international position in water management and coastal engineering, the merger creates a major position in the global water market with annual revenues approaching $500 million, representing about 17% of combined revenues.
Additional benefits include a significantly stronger position with the U.S. Federal Government to pursue both water and environmental projects. Malcolm Pirnie's strong industrial environmental practice brings additional services and a complementary client base that now can be offered services through ARCADIS' global platform. Finally, both companies have similar client-focused business models, which will greatly facilitate the integration efforts that are planned for the next 18 to 24 months.