Granite Construction Inc. (NYSE: GVA) is purchasing Layne Christensen Co. (Nasdaq: LAYN), a water management and drilling service provider. The deal, which is expected to close in the second quarter of 2018, is valued at nearly $565 million including the assumption of net debt.
Layne began in 1882 as a water-well drilling company in South Dakota. The Woodlands, Texas-based target currently operates as a water management, construction and drilling company servicing the U.S. and international water, mineral, and energy markets. The company also provides water treatment services and above ground drilling activities.
"With Layne's expertise and leading water positions, Granite will advance its goal of becoming a full suite provider of construction and rehabilitation services for the water and wastewater market,” states Granite chief executive officer James Roberts. “With enhanced scale and capabilities, Granite will be better positioned to address the growing water and wastewater needs throughout the infrastructure lifecycle. As a stronger player in the attractive water and wastewater sector, we will have significant opportunities to capture a larger share of the market and accelerate our growth prospects."
Granite, headquartered in Watsonville, California, anticipates being able offer a “full lifecycle portfolio” to meet the needs of its public and private water sector clients with addition of Layne. The combined company will be positioned as a premiere player in the transportation and water infrastructure markets, employing nearly 7,000 employees.
Other deals involving the water treatment and commercial waste management sector, includes: Peak Rock’s investment in water treatment supplier Hasa; ProAct’s buying of Themtech; Stella Environmental Holdings Inc.’s purchase of waste transfer station management company Rackleff Enterprises; and Bain Capital’s backing of commercial recycling provider Living Earth.
Perella Weinberg Partners LP is acting as financial adviser to Granite, while Jones Day is serving as legal counsel. Greentech Capital Advisors LLC is serving as financial adviser to Layne, while Latham & Watkins LLP and Stinson Leonard Street LLP are acting as legal counsel.