The Equans services group becomes Bouygues’ leading business hub

PARIS (Reuters) – French conglomerate Bouygues has said that when its € 7.1 billion ($ 8.2 billion) deal to buy technical services group Equans from Engie is finalized, Equans will become its largest segment activity in terms of turnover and staff.

The merger between Equans and the Energies & Services branch of Bouygues will create a new independent business sector with a turnover of 16 billion euros and 96,000 employees, of which 74,000 will come from Equans.

Chairman Martin Bouygues said in a statement that the acquisition – the largest ever by Bouygues – aims to create a new world leader in multitechnical services.

“The multitechnical services market is a market of the future with strong growth potential and will play a crucial role in the energy transition”, added Olivier Roussat, CEO of Bouygues.

The company said it would finance its acquisition of 100% of Equans shares with its existing resources and a fully committed loan from partner banks, adding that the loan would ultimately be refinanced through the bond issuance.

Based on an enterprise value of 6.7 billion euros – i.e. 7.1 billion euros including the IFRS 16 debt – and taking into account the synergies and the strong growth expected in the coming years, the multiple of enterprise value to current operating income 2026 will be 11.4, the company said. .

The transaction will be accretive for Bouygues EPS from the first year and the potential for synergies is estimated at 120 to 200 million euros per year. The new entity aims for a current operating margin above 5%.

The transaction is expected to be finalized in the second half of 2022.

($ 1 = € 0.8655)

Reporting by GV De Clercq Editing by Gareth Jones and Ros Russell

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