Kentz has agreed to a takeover bid from Canada’s largest engineering firm SNC-Lavelin, after rejecting two competing offers from Amec and German firm M+W last year.
Shares in the oil services engineering specialist, which boasts 14,000 staff around the world, surged by a third as news emerged, with the deal valuing each Kentz share at 935p.
The offers last year were pitched at around £700m or 580p per share, but both were rejected as undervaluing the firm.
The board of Kentz has recommended the latest offer to shareholders, which values the international engineering construction group at about £1.2bn.
“Although the board of Kentz believes the company has a strong future as an independent business, it considers that this cash offer substantially recognizes the company’s growth prospects, providing certainty, in cash, to Kentz shareholders today,” Christian Brown, CEO of Kentz.
The firm was founded by Michael Francis Kent in Clonmel, Co. Tipperary 95 years ago, and branched out to operate internationally in the late 1970s as M F Kent.
It successfully completed its first international project with an American engineering and construction partner in Saudi Arabia, acting as a launch pad to grow throughout the Middle East and expand its service offerings.
In 1992, MF Kent suffered heavy losses on a £400m M&E contract for a major hotel project in Barcelona, leaving it fighting for survival.
Two years later, the Malaysian group, Peremba, stepped in and bought a majority stake in the business, providing much-needed capital in the firm, which was renamed Kentz.
A remarkable period of growth followed, culminating in a stock market listing six years ago.
The group now operates three divisions covering engineering, construction and technical support services for oil industry clients around the world.
SNC-Lavalin president and chief executive Robert G Card said the deal would also give it a much greater presence in key growth regions such as the Middle East, North America and Asia Pacific.
“The proposed acquisition of Kentz is consistent with SNC-Lavalin’s strategy of becoming a global Tier-1 engineering and construction company, with a leading position in the oil & gas sector,” he said.
