Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Opus shares rise to three-month high on Canadian buy

Opus shares rise to three-month high after buying Canadian business Stewart Weir

By Tina Morrison

Sept. 4 (BusinessDesk) – Shares in Opus International Consultants rose to a three-month high after the engineering consultancy agreed to pay as much as C$90 million for engineering and environmental advisers Stewart Weir, propelling its Canadian business to its second-largest unit by revenue.

Opus shares gained 4.8 percent to $1.76 after the company said it will pay an initial C$50 million for Stewart Weir, with the potential for a further C$40 million in integration and performance-based payments over three years.

Opus, which last month posted a 13 percent decline in first-half earnings because of a weaker performance from its New Zealand unit, is looking to diversify in existing markets and expand into new markets to grow profits. The company, which began its Canadian operation in 2002, sees the purchase of Stewart Weir as enabling it to expand into pipeline, infrastructure and energy related projects.

“In addition to our entry into the oil and gas sector, the Canadian federal government has highlighted infrastructure as one of its top priorities for the future,” Opus managing director David Prentice said in the statement. “Acquiring Stewart Weir is strategically important given their market strength and growth prospects both in Canada generally and in the oil and gas sector.”

The acquisition gives Opus critical mass to compete for larger projects and establishes a presence in Alberta, Canada’s top growth region.

Established in 1912, Edmonton-based Stewart Weir had normalised earnings before interest and tax of C$9 million in the year ended Jan. 31 on revenue of C$91 million, according to Opus presentation notes.

Last month, Opus said its existing Canadian business lifted sales 6.5 percent to $11.5 million and EBIT rose 51 percent to $780,000. By contrast, the company’s New Zealand revenue was $141 million, followed by Australia at $40 million and the UK at $19 million.

The potential payment for Stewart Weir is the equivalent of between 4.8 times and 7 times historical ebitda, and will be paid for with available cash and existing debt facilities, Opus said.

The acquisition of the employee owned company will add 550 staff to the company’s Canadian unit, boosting total Canadian staff to about 700, Opus said.

Stewart Weir chief executive Brian Pearse will remain with the company as president.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Grey Power: Is Disappointed To Learn Of More Bank Closures

Many older people are being left without essential services because of cost cutting and the march of modern technology. It is now expected that most banking transactions can occur via the internet or telephone. Jan Pentecost, President of the Grey Power ... More>>

ALSO:

Economy: Supply Chain On Brink Of Overload Says National Road Carriers

The New Zealand supply chain is on the brink of overload and it looks like the upcoming peak imports season may push it over the edge says National Road Carriers Association (NRC) CEO David Aitken. “Worldwide supply chains are in disarray,” says Mr Aitken. ... More>>

Retail: Supermarkets Announced As Government’s Second Market Study

The Government has today launched a market study to ensure New Zealanders are paying a fair price for groceries. More>>

ALSO:

Statistics New Zealand: Retail Sales Recover In The September 2020 Quarter

Retail sales values recorded the largest September quarter rise since the series began in 1995, Stats NZ said today. Spending on major household items, vehicles, and groceries contributed to the strong 7.4 percent ($1.8 billion) rise in total ... More>>

Kea Aerospace: New Zealand Flies Into The Stratosphere

Development has started on a solar-powered, unmanned aircraft that can fly in the stratosphere continuously for months at a time. The zero-emission aircraft will carry a suite of imagery equipment that will be game-changing for many industries, vastly ... More>>

Stats NZ: Births And Deaths: Year Ended September 2020

Births and deaths releases provide statistics on the number of births and deaths registered in New Zealand, and selected fertility and mortality rates. Key facts For the year ended September 2020: 57,753 live births and 32,670 deaths ... More>>

ALSO:


Forest & Bird: Kākāpō Wins Bird Of The Year 2020

The nation has voted and Aotearoa New Zealand has a new Bird of the Year. New Zealand’s moss-colored flightless parrot has climbed to the top-spot for the second time in Forest & Bird’s annual Te Manu Rongonui o Te Tau/Bird of the Year competition. ... More>>