Scott Wilson battle hots up as board meets over rival bids

THE board of Scott Wilson will meet tomorrow to consider a pair of rival bids from US firms for the British design and engineering consultancy.

US engineering consultancy CH2M Hill yesterday launched a 245p-a-share offer, valuing Scott Wilson at 189 million and topping an earlier bid from URS which had pitched in at 210p a share. URS later said it would consider matching the offer.

The CH2M approach came a day after Scott Wilson said it would recommend the offer from URS, putting the purchase price at 161m. Under its agreement with Scott Wilson, URS has until 5pm today to match the CH2M offer.

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CH2M bought a 13 per cent stake in the British firm on Monday after revealing that it was considering making a cash offer.

Artemis Investment Management and Aviva Investors Global Services - which between them own about 5 per cent of Scott Wilson - have backed the bid from CH2M.

Lee McIntire, CH2M Hill's chairman, said: "We believe that our model of employee ownership and our shared passion for customer service mean that our offer not only provides shareholders with compelling value, but will also provide the business and its employees with the best environment in which to fulfil their full potential."

CH2M said its takeover proposal represented a premium of 182 per cent to the closing price on 4 June, the last trading day before 7 June, when Scott Wilson revealed that it had received a takeover approach.

The suitor's American rival responded by saying: "URS confirms, following CH2M Hill's offer, that it continues to consider its options with respect to Scott Wilson.

"URS has matching rights arrangements agreed with Scott Wilson and is considering increasing its offer to 245p or above. A further announcement will be made in due course."

Scott Wilson has 5,500 staff in 80 locations globally, including about 3,000 in the UK, working across engineering projects including railways, roads and buildings.

On Monday, the group unveiled a near-doubling of pre-tax profit, up to 18m in the year to 2 May from 9.4m in the previous year.

Turnover fell from 360m to 340m, but the percentage of business from overseas markets rose from 31 per cent to 37 per cent, boosting profits.

The company's projects in Scotland have included the Airdrie to Bathgate railway line, the M77 motorway, the dualling of the A1 in Berwickshire, a hydroelectric scheme in Lochaber and the Clackmannanshire Bridge.

The group was appointed to provide technical support services to the Edinburgh tram project in 2005.

In total, the firm has five offices north of the Border.

Mike Allen, an analyst at Panmure Gordon, which carries a "hold" recommendation on the British firm, said: "For shareholders of Scott Wilson it is getting exciting, URS has suggested it may counter further, so keep holding Scott Wilson shares."

Shares in the British consultancy closed up 3 per cent or 8p at 261p, having risen by 112 per cent on Monday.