Carillion spends over £300m on Eaga

11th Feb 2011 07:34

Contractor and support services specialist Carillion is paying £306.5m for green support services business Eaga.In a deal recommended by Eaga bosses, shareholders will get 118.79p a share in cash and receive the 1.21p interim dividend, taking the total to 120p. That's a 30% premium to last night's closing price, but still well below the 157p they were trading at less than 12 months ago.Carillion said there's a "compelling strategic rationale" for the tie-up and chairman Philip Rogerson expects the acquisition to be immediately earnings enhancing.The firm thinks it can achieve synergies of £9m by the end of 2013, with one-off costs of delivering those savings put at about £15m."Carillion has identified the low carbon market as a strategic area of growth and the acquisition of Eaga will create a scalable platform to build the UK's largest independent energy services provider," Rogerson says."This will also extend Carillion's capability to provide integrated support services solutions for its existing customers, for whom energy services are an increasingly important requirement."The shares came pressure in the autumn as the business fell victim to the coalition government's cost-cutting drive. It was hit hard by the worse than expected reduction in spending on the government's 'Warm Front' programme announced in the Comprehensive Spending Review in October.