The companies were chosen in 2013 by lead developer Paris-based EDF Group as partners on the estimated $21-billion project in Somerset. Negotiations with the U.K. government over electricity pricing continue.
Vying for SNC-Lavalin
Meanwhile, in Canada, SNC-Lavalin remains an acquisition target as it battles to stay competitive amid continuing legal troubles related to alleged bribery of officials on projects in Montreal and Libya by long-departed executives, including its former CEO.
Current chief Robert Card is pushing to resolve federal criminal fraud charges that if proven, could result in the firm's debarment as a government contractor for 10 years.
But the April selection of a firm-led team to build a replacement bridge in Montreal appears to signal a settlement of the case brought in February. A trial date start was pushed back to July 3 from April.
That team also includes members with existing ownership ties to ACS.
SNC-Lavalin ranks at No. 7 on ENR's list of the Top 225 Global Design Firms, with $3.5 billion in 2013 reported design revenue, but it has about $8.8 billion in total 2014 revenue.
Spokesman Louis-Antoine Paquin has said that SNC-Lavalin "is not engaged in any discussions of this nature with any companies.”
The firm told the Financial Post that it is continuing to find a buyer for its Highway 407 privatized assets, which is believed to be worth up to $2.2 billion.
In a June 3 note, Maxim Sytchev, E&C sector analyst for Toronto-based Dundee Securities, said the "likelihood of a strategic player taking out the entire company is relatively small.”
He pointed to the Spanish firm's "very complex corporate structure” and the potential of political controversy in Quebec if ACS acquires a local corporate giant.
Sytchev also believes WorleyParsons is "simply too small and has its own host of issues to deal with." WorleyParsons declined to respond to acquisition-related media inquiries in Australia.
The analyst believes that Canadian pension funds may be a more credible buyer.
"They have the cost of capital advantage for the hard assets and patience to own a turn-around," he said. "The barrier to this scenario is ring-fencing potential legal liabilities from SNC’s past transgressions."
But Sytchev sees potential for improved company results in the next 18 months, particularly in the firm's infrastructure division with key backlog growth, and LNG awards gained through new subsidiary Kentz that could add to backlog through 2017.
