U.S. hedge fund Elliott Capital Advisors disclosed on Monday it has taken a 6.8 percent stake in WS Atkins after the British engineering and construction consultancy business agreed to be bought in a $3.6 billion (US$2.7 billion) deal.
Elliott said in a regulatory filing that it had acquired the stake in a contracts-for-difference deal on April 21, the day after Atkins agreed to its acquisition by Canadian construction and engineering group SNC Lavalin.
Shares in Atkins last traded on Monday at 2,100 pence a share, above SNC’s offer price of 2,080 pence.
After SNC made an indicative offer for Atkins on April 3, Liberum analyst Joe Brent told clients in a note the move could spark a bidding war, given growing consolidation in the industry. He declined to comment on Monday.
The move on Atkins opens up another front in Europe for Elliott, as it presses Dutch-based paintmaker Akzo Nobel to open takeover talks with U.S. suitor PPG Industries, and separately campaigns for a restructuring at Anglo-Australian miner BHP Billiton.
Elliott’s stake in Atkins makes it the second-biggest shareholder, Thomson Reuters data showed, just behind asset manager Columbia Threadneedle Investments.
A spokeswoman for Elliott declined to comment on why the firm had taken a stake in Atkins. A spokesman for Atkins also declined to comment, while no one at SNC-Lavalin could immediately be reached for comment.
Update: Caisse de dépôt et placement du Québec agreed to extend a loan of $1.5 billion to SNC and buy $400 million of equity in the company to help finance the Atkins acquisition.
By Vikram Subhedar and Simon Jessop
(Additional reporting by Justin Varghese, Esha Vaish and Allison Lampert; editing by Greg Mahlich)
(This story has been edited by Kirk Falconer, editor of PE Hub Canada)
Photo courtesy of WS Atkins