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Nippon Koei enters contest for Hyder

Japanese consulting giant Nippon Koei has made a rival offer for Hyder Consulting.

The firm bid 680p per share for Hyder, valuing the company at £268M.

It comes just days after Dutch company Arcadis bid £256M for Hyder, and could spark a bidding war.

Hyder chief executive Ivor Catto said the Hyder Board was recommending the cash offer from Nippon Koei to shareholders. Arcadis said that it was considering its position.

Catto added: “The Hyder Board considers that Nippon Koei’s cash offer substantially recognises Hyder’s growth prospects, and provides certainty, in cash, to our shareholders today.

“The merged group should also provide further opportunities for our highly valued employees and clients.”

Noriaki Hirose, president of Nippon Koei, said: “This merger represents a truly transformational step for Nippon Koei, fulfilling founder Yutaka Kubota’s long term strategic vision of broadening the client base and geographic footprint of Nippon Koei, while continuing to focus on our core sectors of transportation, utilities and property.”  

Nippon Koei is Japan’s largest engineering consultant with a turnover of ¥74.4bn (£434M) for the year ended 31 March 2013. It employed 2,990 staff as of 1 April 2013, 655 of them civil engineers by professional qualification.

Nippon Koei anticipates that Hyder will continue to operate as a standalone division of the combined business within an operating structure designed to exploit the growth opportunities for both businesses. As such, the offer is not predicated upon cost synergies.

The board of Nippon Koei does not currently anticipate any restructuring of the operations of Hyder, any employee redundancies, the closure of any locations of Hyder’s places of business or any redeployment of Hyder’s fixed assets.

WH Ireland analyst Nick Spoliar said: “This morning’s new bid for Hyder Consulting provides further dramatic illustration of the fundamental drivers for global consolidation in this space and the attractions of standalone assets to major players.”

The latest acquisition saga comes after Aecom last month revealed its intention to buy competitor URS for more than £2bn.

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