CB&I to buy engineering firm Shaw Group for $3.04 billion

Energy infrastructure construction company Chicago Bridge & Iron Co (CB&I) today launched a friendly $3.04 billion cash and stock takeover offer for engineering firm Shaw Group Inc.

CB&I has offered $46 per share - $41 in cash and $5 in stock, a premium of 72 per cent to the Shaw's Friday closing price.

The merger will create one of the world's largest engineering and construction companies in the global energy industry. Both companies believe this deal will create value through a combined company with larger share in the energy market.

Houston, Texas-based CB&I said the deal would expand its engineering operations in the energy sector, as global demand for fossil fuels continues at pace.

''This is a highly compelling transaction that will create significant value for our shareholders,'' Philip Asherman, CB&I's chief executive said in a statement. ''By adding them into the CB&I family, we will become fully diversified across the entire energy sector.''

Baton Rouge, Louisiana-based Shaw Group, a Fortune 500 company, has core competencies in the energy, chemicals, power, environmental, infrastructure and emergency response sectors.
Founded in 1987 by J M Bernhard Jr, the company was originally known as Shaw Industries Inc and changed its name to Shaw Group when it went public in 1993.

The company has grown through a series of acquisitions, including a 20 per cent stake in Toshiba-owned Westinghouse Electric Company, which it sold last year to Toshiba, Japan's largest maker of nuclear reactors, for about $1.6 billion. (See: Toshiba to buy Shaw Group's Westinghouse stake for $1.6 bn)