WS Atkins exploring M&A, keeps own counsel on CH2M merger report

By Esha Vaish

Feb 8 (Reuters) - British engineering and design consultancyWS Atkins is examining potential acquisitions, itschief executive said, but he declined to say if it had beenapproached by U.S. rival CH2M over a $4 billion merger.

Dealmaking in engineering and construction has picked up inrecent years, including a failed attempt by Britain's Carillion to merge with Balfour Beatty.

Atkins has been trying to diversify away from its homemarket, which accounts for over half of its revenue, and theU.S. is looking attractive for infrastructure spending.

"We see very interesting signs that what was regarded aspre-election rhetoric is now really coming together quitenicely," CEO Uwe Krueger said after a trading update.

Atkins, which worked on London's 2012 Olympic site as wellas a renovation of New York's Statue of Liberty, was seekingdeals in the United States, Middle East and Asia Pacific as wellas to grow its energy business, Krueger added on Wednesday.

"At any point in time we're looking at quite a number ofacquisition opportunities... Whatever makes sense from acommercial and strategic perspective, we will be looking at itwhether it's small, medium-sized or large," he told Reuters.

Krueger, however, declined to comment on a January report inthe Times that said privately owned CH2M made an approach forAtkins at a senior level over a $4 billion merger.

"We have a strict policy that we do not comment on rumour orspeculation so there's really nothing to add," he said.

Shares in Atkins, which maintained its full-year outlooktargets and reported in-line third-quarter trading, were up 1.7percent at 1,504 pence at 1013 GMT, giving it a market value ofabout 1.5 billion pounds.

A merger with CH2M would increase Atkins' U.S. footprint togreater than 50 percent of group sales and strengthen itsposition in energy, water and transportation, according toLiberum, which has a "buy" rating and 1,600 pence target price.

Atkins said on Wednesday its financial position remainedstrong. Liberum, which said rumours of a deal between Atkins andCH2M was "credible", estimated net cash of 27.4 million poundsfor the year ending March 2017. (Editing by Alexander Smith)

Carillion Plc