Keller Group plc Acquires GeoConstruction Group, North America
Keller, the international ground engineering specialist, announces that it has agreed to purchase the net assets of the GeoConstruction group ("Bencor") of Layne Christensen Company (NASDAQ: LAYN) for a consideration of around US$40m (£26m). The business is headquartered in Dallas and operates throughout North America. The exact consideration, to be paid in cash from Keller's existing facilities, will depend on the level of working capital inherited on closing.
Bencor's traditional product offering is diaphragm walls ("D-walls"), a product most often used in major infrastructure projects and which to date Keller has only been able to offer customers on a limited basis and in certain geographies. The acquisition will therefore strengthen Keller's product range and its ability to offer complete packaged solutions both in North America and elsewhere. The business will form part of the Group's North America Division.
D-wall projects tend to be large and Bencor has historically worked on less
than 10 projects a year. As a result, the size and timing of contracts has an effect on annual revenues, which are typically between $50m to $80m a year.
As part of the acquisition, Keller will take on the existing, highly regarded management team and all 150 employees, as well as Bencor's ongoing construction contracts. It is anticipated that the order book at closing will be around US$160m, of which about US$120m relates to the East Branch Dam Cutoff Wall Rehabilitation Project in Pennsylvania. This contract is scheduled to run through to the middle of 2018.
The acquisition remains conditional on the assignment to Keller of Bencor's
major ongoing construction contracts and completion is expected by the end of June 2015.
Alain Michaelis, Chief Executive of Keller, said:
"This important acquisition marks another milestone in our strategy of extending our global leadership by expansion into new technologies.
"The addition of Bencor's D-wall technology and equipment will allow us to
further expand our global customer offer for complex projects."