business merger

Canadian Construction Giant Aecon Agrees to Acquisition

acquisitions for news itemsOn Oct. 26, Calgary-based construction and engineering firm Aecon Group Inc. and CCCC International Holding Ltd. (CCCI) announced that they have entered into a definitive agreement under which CCCI will acquire all of the issued and outstanding common shares of Aecon for $20.37 per share in cash, representing an enterprise value of $1.51 billion.

 

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“We believe this is a very positive outcome for Aecon and our key stakeholders,” said The Hon. Brian V. Tobin, P.C., O.C., Aecon’s Chairman. “This transaction is the result of an active and diligent sale process that has enabled us to select an outstanding partner and create significant shareholder value.”

CCCI is the overseas investment and financing arm and a wholly-owned subsidiary of China Communications Construction Company Limited (CCCC), one of the world’s largest engineering and construction groups. Its core business activities include infrastructure construction, infrastructure design and dredging. It is primarily engaged in providing customers with integrated solutions services for each stage of infrastructure assets, including ports, terminals, roads, bridges, rail and tunnels, leveraging on its extensive operating experience, expertise and know-how accumulated from projects undertaken in a wide range of areas over the past six decades.

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CCCC has more than 118,000 employees (including 48,000 foreign employees) in more than 140 countries and regions. CCCC currently ranks third in Engineering News Records’ list of the world’s top 225 International Contractors in 2016 and had revenue of US$62 billion and EBITDA of US$5 billion in 2016. CCCC is publicly traded on the Hong Kong (1800.HK) and Shanghai (601800.SH) Stock Exchanges.

“This is an excellent fit for both of our companies,” said Lu Jianzhong, president of CCCI. “Aecon has a strong management team and a very impressive track record that have made it a leading construction company in Canada and a pioneer in public private partnerships and concession operations. It will now gain access to significant capital, complementary infrastructure expertise and an international network to support its growth ambitions.”

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He continues, “The vision and leadership of John M. Beck, President and CEO, have built Aecon into the successful company it is today, a diversified business focused on innovation and customer service with a formidable management team. We will continue to rely on John’s experience and leadership as we together take Aecon to a new level.”

CCCI recognizes Aecon as a leading provider of construction services spanning the four core segments of infrastructure, energy, mining and concessions with competitive know-how, state of the art facilities, experienced personnel and leading market positions. CCCI recognizes Aecon’s importance to Canada and is committed to ensuring that the transaction will deliver benefits to Canada.

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“This transaction creates significant and immediate value for Aecon shareholders, strengthens our competitive position in Canada and abroad with enhanced capabilities and financial resources, and provides expanded opportunities for our people,” Beck said. “We look forward to partnering with a global leader while retaining Aecon’s Canadian headquarters and values. I’m excited and proud to be part of this new chapter for Aecon and for Canada.  And I am personally committed to working with the Aecon management team and CCCI on CEO succession planning which began last year, prior to our exploring the sale of the company.”

The transaction will be implemented by way of a statutory plan of arrangement under the Canada Business Corporations Act and is subject to customary closing conditions, including court approval of the arrangement; approval of two-thirds of the votes cast by holders of common shares in person or by proxy at a special meeting of Aecon shareholders; and applicable government and regulatory approvals under the Investment Canada Act, the Canadian Competition Act and from relevant authorities in China. The parties expect to close the transaction by the end of the first quarter of 2018. The transaction is not subject to any financing condition.

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Read the full AECON press release here: Aecon Group agrees to be acquired by CCCI

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