RPS Group shares jump 12% as Tetra Tech outperforms WSP for Oxfordshire-based professional services firm
- RPS Group share price jumped more than 12% in morning trading
- Tetra Tech’s offer is higher than that previously submitted by WPS
California-based Tetra Tech group has agreed a £636m deal to acquire Oxfordshire-based RPS Group.
RPS actions rose sharply today and was up 12.08 per cent or 25.00p to 232.00p in morning trading.
The US group’s bid has outpaced a £591m bid from consulting giant WSP, which was scheduled to go ahead after being announced in August.
To the upside: RPS Group share price rose sharply in today’s morning trading
But now it looks like Tetra Tech will be the new owner of RPS, which employs consultants, designers, planners, engineers and technical specialists around the world who provide specialized services to government and private sector clients with a focus on front-end consulting. .
The acquisition price represents a premium of approximately 7.8 per cent over the offer price of 206 pence per RPS share offered pursuant to the WSP Offer. WSP has told investors that it is considering its options.
The Tetra Tech deal values the entire issued and unissued share capital of RPS at around £636m.
Tetra Tech said: ‘The acquisition price also represents a premium of approximately 89.7 per cent. at the Closing Price per RPS Share of 117 pence on August 8, 2022 (being the last Business Day before the start of the Offer Period).’
RPS employs 5,000 people which will bring the total number of Tetra Tech employees to 26,000.
John Douglas, CEO of RPS, said: “Joining Tetra Tech represents a very attractive combination of two industry-leading companies for our customers and provides an ideal opportunity for our people to achieve RPS’s goals of contributing significantly to the challenges most challenging in the world. problems in energy transformation and water management around the world.
‘I am very excited about the future of our combined company and the benefits to our people and customers.
“By coming together, Tetra Tech provides RPS and its employees with a strong, culturally aligned platform that creates a preeminent consulting and engineering company that addresses climate change and all its effects.”
Dan Batrack, President and Head of Tetra Tech, said: “RPS Group is advancing our long-term strategy to enhance our position as the leading high-end global consultancy for water, environment, sustainable infrastructure and energy transformation.”
‘We welcome RPS Group associates to join us and collectively take advantage of our long-term customer relationships and project expertise. As a global consultancy committed to high-end solutions, we can offer our expanded team of associates even greater career opportunities.”
Analysts at Peel Hunt said: ‘We are raising our price target from 206 pence to 244 pence (a 10 per cent premium to Tetra Tech’s offer) and updating our recommendation from Hold to Add. We look forward to further developments.’