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WYG agrees to be sold to US consultancy giant Tetra Tech

Project management and consultancy group WYG has agreed to be taken over by US consultancy giant Tetra Tech for £43.4m. Under the terms of the offer made by Tetra Tech, WYG shareholders will receive 55p per share, representing a 244% premium on last Friday’s closing price.

With more than 18,000 employees and 2018 revenues of $2.96bn, California-headquarted Tetra Tech is a leading provider of consulting and engineering services. The firm supports government and commercial clients by providing a range of multidisciplinary services focused on water, environment, infrastructure, resource management, energy, and international development.

WYG employs 1,600 staff primarily in the UK and Europe, delivering consulting and engineering solutions for complex projects across key service areas including planning, water and environment, transport, infrastructure, the built environment, architecture, urban design, surveying, asset management, program management, and international development.

The acquisition of WYG expands Tetra Tech’s geographic presence and positions Tetra Tech as a leading global consulting, engineering and programme management firm focused on water, environment and infrastructure. In addition, the acquisition enhances Tetra Tech’s business for international development supporting both the European Union and the United Kingdom’s Department for International Development.

Commenting on the acquisition, Dan Batrack, Tetra Tech chairman and CEO, said: “WYG advances our strategy to add firms that support our position as the premier global high-end consulting, engineering, and program management firm. WYG’s expertise in infrastructure and programme management, as well as water and environmental services, enables us to deliver innovative solutions to support the UK’s infrastructure needs. Together, we will be able to provide an expanded scope of services to our customers and offer our combined staff even greater professional opportunities.”

Jeremy Beeton, WYG chairman, said, “Becoming part of Tetra Tech brings the benefits of scale and access to broader expertise across highly complementary geographies and client relationships. It also brings the operational infrastructure and financial strength to support WYG’s long-term ambitions, whilst we provide Tetra Tech with a strong platform for growth in the UK and Europe. We believe the combination will provide greater opportunities for our people and our clients as well as offering certainty of immediate value to our shareholders."

Given that the WYG board has unanimously recommended Tetra Tech’s bid of 55p per share, the deal is virtually certain to be ratified. Tetra Tech have hinted that there are likely to be cost savings across the business, with back office overheads and corporate services being rationalised in due course.

Tetra Tech’s financial advisor is Perella Weinberg Partners and its legal advisor is Hogan Lovells International LLP. WYG’s financial advisor is N+1 Singer and its legal advisor is DLA Piper.