https://www.engineeringnews.co.za

Powerhouse merger completed

SMOOTH ACQUISITION Wyle will become a KBR business unit within KBR's government services segment and will maintain much of its current structure to ensure business continuity

EXCEPTIONAL TRACK RECORD Wyle’s track record consists of an array of custom solutions that drive mission success for its customers

24th June 2016

  

Font size: - +

Global technology, engineering, procurement and construction company KBR announced late last month that it has entered into a definitive agreement to acquire specialised engineering, scientific and technical services provider Wyle.

Wyle’s track record consists of an array of cutting-edge custom solutions that drive mission success for customers in the US Department of Defense, the National Aeronautics and Space Administration and other federal agencies. The company’s expertise includes systems and sustainment engineering, programme and acquisition management, life science research, space medical operations, information technology and the testing and evaluation of aircraft, advanced systems and networks.

KBR president and CEO Stuart Bradie stated late last month that the acquisition will combine KBR’s strengths in international, large-scale government logistics and support operations with Wyle’s specialised technical services, largely focused in the contiguous US. The addition of Wyle’s highly advanced capabilities significantly expands KBR’s global government services offerings, moving the business towards the high growth, more specialised, technology- and science-driven sources of long-term annuity type revenues with greater differentiation and higher margins, all of which are consistent with our previously announced strategy.

Together with Wyle, KBR will now provide capabilities that span the full spectrum of the life cycle of aerospace and defence programmes from research and development, through test and evaluation, to operations, maintenance and field logistics, reported Bradie.

“Expanding our government services capabilities and service offerings into more profitable and complementary market segments is a key part of KBR’s growth strategy. This strategic acquisition creates the equivalent of a global $2-billion government services organisation with full service capabilities drawing on the best-in-class capabilities of both organisations,” said Bradie.

He pointed out that Wyle’s highly specialised and differentiated offerings to the company’s global government services portfolio improves KBR’s overall risk profile by expanding into other government funding sources for higher-margin and largely cost-reimbursable work.

He added that “the acquisition provides us with broader relationships with US government clients and grows our US presence by acquiring a highly respected US-focused franchise. “The acquisition is expected to be accretive in the first year and provide longer-term synergistic opportunities in markets where KBR’s large-scale logistics and project management capabilities combine with Wyle’s specialised technical capabilities.”

Wyle will become a KBR business unit within KBR’s government services segment and will maintain much of its current structure to ensure business continuity, stated Bradie. KBR and Wyle’s management teams will be highly focused on a successful transition which retains Wyle’s greatest asset, its 3 800 professionals, while also capitalising on the new opportunities of the combined company across all of government services regions, including the US, Europe, the Middle East, Africa and Asia Pacific. As of year-end last year, Wyle’s funded backlog was $440-million with an additional $1.1-billion of orders not yet funded, but expected.

He explained that 100% of Wyle’s business will be acquired through the acquisition of shares pursuant to a merger subtransaction structure. The transaction price to KBR is $570-million, after adjustments for about $30-million of acquired tax benefits, and subject to other customary adjustments, including for net working capital, net cash and indebtedness of Wyle.

Edited by Zandile Mavuso
Creamer Media Senior Deputy Editor: Features

Comments

Showroom

Stewarts & Lloyds
Stewarts & Lloyds

Stewarts & Lloyds today supplies steel and tube, pipe and fittings, valves, pumps, irrigation, fencing, profiling and roofing products. The cash...

VISIT SHOWROOM 
Werner South Africa Pumps & Equipment (PTY) LTD
Werner South Africa Pumps & Equipment (PTY) LTD

For over 30 years, Werner South Africa Pumps & Equipment (PTY) LTD has been designing, manufacturing, supplying and maintaining specialist...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.201 0.267s - 271pq - 2rq
Subscribe Now