A merger expected to close in October will make Los Angeles-based Aecom Technology Corp. the second-largest construction and engineering firm in the United States and one of the largest in the world. Aecom — whose projects include the new World Trade Center in New York, stadiums for the most recent World Cup championship, and the design of the new headquarters for the Los Angeles Police Department — will merge with San Francisco-based URS Corp. The latter was responsible for a number of projects in Southern California — for example, the 22 Freeway, several community colleges and the UCLA Ronald Reagan Medical Center. URS is also a major player in the energy industry, which reportedly made up about 40 percent of the company’s revenue in 2013.
The merger, which will make Aecom the largest public company in the city of Los Angeles, involves the firm’s paying $4 billion and taking on $2 billion of URS’s debt. In 2013 the two companies’ combined revenue came to $19 billion, and they have about 95,000 employees in countries around the world. Aecom and URS currently employ a combined 1,312 people in Los Angeles, and that number is expected to increase, according to the Aecom chief executive.
The deal is major business news in Southern California, where construction and engineering have long been staples of the local economy. Also, earlier this year, Occidental Petroleum and Toyota Motor Corp. announced their plans to move out of the state, so the Aecom-URS merger represents a boost in confidence for business in the region.
As with any business transaction, decisions made today can have repercussions far down the road. If your company is merging with or acquiring another, then you’ll need a strong legal foundation for protecting the interests of all parties involved.
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Source: Los Angeles Times, “Merger of Aecom and URS to create giant L.A. construction firm,” Stuart Pfeifer and Chris Kirkham, July 13, 2014