(Bloomberg) -- Engineering firm WSP Global Inc. agreed to buy energy-focused rival Power Engineers Inc. for C$2.44 billion ($1.8 billion) with the financial backing of Singapore’s sovereign wealth fund and three large Canadian pension funds.
The deal is “a transformative step that will position us at the forefront of the energy transition,” WSP Chief Executive Officer Alexandre L’Heureux said in a statement announcing the transaction on Monday.
The deal continues an acquisition spree for WSP, following several transactions already this year. In 2022 it bought the environment and infrastructure business of UK-based John Wood Group Plc for about C$2.4 billion.
Power, which is based in Hailey, Idaho, offers engineering and environmental consulting to power generators, renewable energy firms, food companies and other industries. About 900 of its 4,000 employees are also shareholders. Owners of 83% of Power shares have agreed to support the sale and reject any rival proposals for the next three months, according to the announcement.
To finance the deal, WSP is taking on new loans and selling C$1 billion in stock. Half of the equity raise will come from a public offering and half from private sales to four large institutions: Singapore’s GIC Pte., Caisse de Depot et Placement du Québec, British Columbia Investment Management Corp. and Canada Pension Plan Investment Board.
The deal will be “immediately accretive” to adjusted earnings per share and position WSP for massive projected investments in cleaner electrical grids, infrastructure and real estate, the Montreal-based group added. It will also increase the company’s exposure to the US market.
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