British engineering group bids to create £5bn group capable of offering services across the oil and gas chain
Amec, the UK engineer and project management group, has struck a “transformational” £1.9bn deal to buy US-listed rival Foster Wheeler in a move designed to capitalise on new opportunities in the oil and gas markets.
The acquisition, as yet only “provisionally agreed”, marks the denouement of a two-year dalliance with Foster, which is domiciled for tax reasons in Zug, Switzerland, and employs 13,000 people.
Samir Brikho, Amec chief executive, said: “In oil and gas, it will add their midstream and downstream capabilities to our existing upstream ones, bringing with it new customers. This is a transformational combination.”
Amec, which has expanded rapidly in recent years off the back of a strong presence in the North Sea, will add Foster’s prowess in the growing markets of liquefied natural gas (LNG) and shale gas – enabling the enlarged group to provide services across the entire oil and gas chain.
The two sides also make a good geographical fit, with Amec’s North American and European footprint enhanced, Mr Brikho said, by Foster’s strengths in Saudi Arabia, Qatar and Oman in the Gulf, growing businesses in Thailand and India and bigger presence in China, where it has 900 people. That’s on top of Foster’s LNG expertise in Canada and what Mr Brikho called its “shale gas position”.