WS Atkins in talks to buy Bovis from P&O

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The Independent Online
WS ATKINS, one of the UK's largest consulting engineers, is in advanced talks to buy Bovis, the building division of the transport group P&O, in a deal that would create a construction giant with sales of more than pounds 2bn a year.

The Surrey-based companyemerged as the sole bidder for Bovis after two rival suitors, the German contractor Hochtief and the UK building group John Laing, dropped out earlier this year.

Both WS Atkins and P&O declined to comment yesterday, but sources close to the negotiations said the two sides were talking about an outright sale of Bovis after scrapping plans for a series of joint ventures.

Industry sources said that Bovis, a highly regarded construction business that last year had sales of over pounds 1.85bn and profits of over pounds 16m, could fetch up to pounds 350m.

A tie-up between WS Atkins, which posted a pounds 29m pre-tax profit on sales of pounds 366m in 1998, and Bovis will create a broad-based construction group offering almost every skill required on a building project.

Industry analysts said that the two companies would be an excellent fit. WS Atkins' expertise in project management, consulting engineering and outsourcing would complement Bovis's construction skills.

Sir Frank Lampl, the chairman of Bovis, has repeatedly said that he wants to expand the range of services the company offers.

In Sir Frank's view, Bovis needs to add specific engineering skills to its core activity of construction management.

WS Atkins would also give Bovis access to a number of overseas markets through its operations in the Middle East, Asia and Continental Europe.

The company has been one of the stock market's star performers since floating in mid-1996. Its share price has almost trebled from just over 230p at flotation to a peak of 669p in July, valuing the group at over pounds 600m.

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