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UPDATE 1-Canada's SNC-Lavalin to buy WS Atkins in $3.6 bln deal

Published 2017-04-20, 05:34 p/m
© Reuters.  UPDATE 1-Canada's SNC-Lavalin to buy WS Atkins in $3.6 bln deal
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April 20 (Reuters) - Canadian engineering and construction company SNC-Lavalin Group Inc SNC.TO on Thursday offered to buy British engineering and consultancy firm WS Atkins Plc ATKW.L for $3.6 billion, firming up an indicative offer it made earlier this month.

SNC-Lavalin's offer of 2080 pence ($26.66) per Atkins share in cash, is the same as the indicative offer Atkins had disclosed on April 3. The offer represents a 35.1 percent premium to the stock's closing price on March 31.

Atkins had said at the time that SNC-Lavalin had until May 1 to either make a firm offer or withdraw, according to the City Code on Takeovers and Mergers applicable to British companies.

Canadian pension fund Caisse de depot et placement du Quebec (CDPQ), SNC's biggest shareholder, will extend a loan of $1.5 billion to SNC and buy $400 million of equity in the Montreal-based company, to help finance the acquisition. loan will be secured by the value and cash flows of SNC-Lavalin's interest in the Highway 407 ETR project in Ontario, CDPQ said separately on Thursday.

SNC's funding will also include an $800 million public bought-deal offering, the company said.

SNC said it expects the deal to generate about $120 million in cost savings.

RBC was SNC's financial adviser, while Norton Rose Fulbright provided legal counsel.

The transaction is expected to close in the third quarter of 2017, SNC said.

($1 = 0.7802 pounds)

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