Offer gives Opus investors chance to realise investment

Takeover plan by WSP Global is deemed attractive

PETALING JAYA: The takeover offer of UEM Edgenta Bhd’s New Zealand-based Opus International Consultancy Ltd by WSP Global Inc is deemed attractive and considered an opportunity for Opus shareholders to realise their investment.

WSP, in its takeover document to UEM Edgenta yesterday, said Opus shares had significantly underperformed relative to the New Zealand market over the last two years.

“Over the last two years, Opus shares have performed significantly worse than the NZX50 index. This offer effectively provides Opus shareholders who have held shares over that period the opportunity to make up some of this underperformance.”

WSP is proposing to purchase UEM Edgenta’s stake – comprising 90.51 million shares in Opus – for NZ$1.85 a share or a total of NZ$167.44mil (RM512.48mil), which includes the option for Opus to declare and pay a dividend of up to seven cents a share to its shareholders.

UEM Edgenta, which has accepted the takeover offer, announced on Bursa Malaysia yesterday that the takeover offer document was received by Opus on Aug 30, following the waiver by WSP of the due diligence pre-condition contained in the lock-up agreement.

UEM Edgenta shares closed six sen lower at RM2.71 yesterday.

Opus is a leading multi-disciplinary infrastructure consultancy. It provides services on major infrastructure projects for the public and private sectors.

WSP, meanwhile, provides technical expertise and strategic advice to clients in the property and buildings, transportation and infrastructure, environment, industry, resources (including mining and oil and gas) as well as power and energy sectors.

In a note to Opus minority shareholders, WSP president and chief executive officer Alexandre L’Heureux said the offer is at a significant premium to the recent Opus share price.

“WSP believes it represents a compelling offer for all Opus shareholders, specifically being at a premium of 85.1% and 84.8% to the one and three-month volume weighted average price per Opus share, respectively, for the period ended on Aug 11.”

L’Heureux said combining with Opus is an attractive opportunity for both parties.

He added that through WSP Group’s global presence, Opus would be able to greatly leverage WSP’s customer base and strong international brand equity to significantly bolster its positioning and growth outside New Zealand.

Opus has operations in Australia, New Zealand, Canada, the US and the UK. It also has existing contracts in the Middle East and North Africa but has stated that trading activities in that region are not supportive of growth.

WSP also pointed out that Opus’ offshore entities in Australia, Canada, the US and the UK recorded operating revenue of NZ$189.3mil and an operating earnings before interest and taxes (EBIT) loss of NZ$9.8mil in 2016.

“These results negatively impacted Opus’ overall performance. Opus’ more stable New Zealand business recorded broadly flat revenue and EBIT in 2016 and 2015.”

WSP’s offer for acceptance by UEM Edgenta is until 11.59pm on Nov 27, 2017.

UEM Edgenta also requires shareholders’ approval at a general meeting, expected to take place in the fourth quarter, for the proposed disposal.