Jacobs Engineering to Buy 4 Firms From Dravo Corp.
A Pasadena engineering and construction firm announced plans to buy four companies from Dravo Corp., an ailing Pennsylvania company that has launched a massive restructuring.
Jacobs Engineering Group said it has signed a letter of intent to acquire Gibbs & Hill, a New York-based engineering unit; Dravo Engineering Cos., with main offices in Pittsburgh and Atlanta; Dravo Constructors and Weyher/Livsey Constructors, construction subsidiaries headquartered in Pittsburgh and Atlanta.
The deal would nearly double the size of Jacobs, which already operates nationwide and has about 2,500 permanent employees plus 3,000 to 4,000 temporary workers.
John W. Prosser, Jacobs senior vice president for finance and administration, said Jacobs has not done a lot of work for the transportation, pulp and paper, steel and power generation industries, and wants to acquire the Dravo subsidiaries because they have.
Jacobs earned $3.5 million on sales of $320 million for the year ending Sept. 30.
Dravo and Jacobs have yet to agree on a price for the deal, and both Prosser and Dravo spokeswoman Karen Esch declined to estimate how much the four subsidiaries might be worth.
Dravo’s engineering and construction division, which includes the four companies to be sold to Jacobs, has been losing money.
Prosser declined to comment on what Jacobs might do to turn around its latest acquisitions and whether it would buy other engineering and construction firms. But he did note that Jacobs bought a 350-employee construction company for $11.8 million on Oct. 1.
Prosser added that the industry is going through a period of concentration. “We see an awful lot of opportunities, and if any arise we’ll have to take a look at it.”
Confronted by losses of $60.6 million on sales of $517.9 million in the first nine months of this year, Dravo’s board chose to sell off the money-losing construction half of the company and focus on the production of lime and and glass.
