With limited options, WSP Global sticks with Arcadis takeover plan

WSP Global WSP-T on Thursday reconfirmed its intention to take over consulting and engineering group Arcadis ARCVF, after the Dutch firm rebuffed the first two bids that had valued it at up to €5.4-billion (US$6.3-billion).

WSP did not disclose a new offer price, but said in a statement it would prepare an offer memorandum and submit it to the Dutch financial watchdog for review and approval by Oct. 15.

Arcadis rejected an improved proposal of €51.5 per share in July, after Reuters reported earlier in the month that the Canadian company had been working on a possible bid.

The latest price offered by WSP would value Arcadis around €5.4-billion including debt, according to Reuters’ calculations. Arcadis opposed both bids, saying they undervalued the company.

Since the takeover attempt was announced, Arcadis’ market value has recouped some of the losses incurred in recent years, with the share price jumping to around €44 from €34 a day before the Reuters report.

Stichting Lovinklaan, an employee foundation which holds the largest stake in Arcadis with 19 per cent of shares, does not intend to support the takeover, Dutch daily FD reported on Wednesday.

WSP also said on Thursday that the Arcadis boards had yet to engage with it.

In a note to investors, KBC Securities analyst Kristof Samoy said he suspected this was WSP’s final attempt to force the Arcadis board to the negotiating table.

“One can hardly argue that this is a friendly maneuver,” Samoy said. “Only a very high proposal (€60 per share) stands a chance in our view.”

WSP’s options for pursuing Arcadis without board support appear limited due to the Dutch corporate anti-takeover mechanism called poison pill, which is designed to thwart hostile acquisitions.