Colorado-based CH2M on Friday officially became a wholly owned subsidiary of Dallas-based Jacobs Engineering, CH2M announced in a filing with the U.S. Securities and Exchange Commission. More details about the merger will be disclosed Monday, CH2M said at press time.
CH2M shareholders voted Wednesday to approve the buyout.
The preliminary results of the special meeting of CH2M shareholders show more than 95 percent approval for the merger, the two companies said in a joint press release. In addition to deciding the merger question itself, each stockholder was entitled to exercise various cash/stock options in exchange for their CH2M shares.
The $3.27 billion deal involves Jacobs taking on some CH2M debt. The combination of the two international engineering concerns will become an even larger player within the Energy Department’s weapons complex.
CH2M already holds sizable cleanup contracts for DOE including key roles at the Hanford Site in Washington state and the Oak Ridge Reservation in Tennessee. It leads the corporate partnership that in October took over environmental remediation of the Paducah Gaseous Diffusion Plant in Kentucky in a deal that could be worth $1.5 billion over five years. However, an AECOM-CH2M team in October lost out on the $4.7 billion liquid waste management contract at the Savannah River Site in South Carolina, but has protested the award to a partnership led by BWX Technologies.
CH2M and BWXT manage the West Valley Demonstration Project in upstate New York under a $545 million project contract that extends until March 2020.
Jacobs is part of a team, with Honeywell and Stoller Newport News Nuclear, that in May won a 10-year contract worth up to $5 billion to operate the Nevada National Security Site for DOE’s semiautonomous National Nuclear Security Administration. Jacobs, Leidos, and Centerra comprise Mission Support Alliance, which provides infrastructure services at the Hanford Site.
The CH2M-Jacobs merger creates a global $15 billion company with over 70,000 employees, based on current payrolls.
CH2M considered potential merger partners for several months, and in May and June of this year had expressions of interest from Jacobs and at least two other companies, according to public filings by CH2M.
CH2M CEO Jacqueline Hinman will not stay on with Jacobs. Jacobs Chairman and CEO Steve Demetriou said recently he has already visited many CH2M offices and met with clients that would be affected by the merger. The Jacobs chief didn’t offer specifics on what offices he has visited.
