Engineering and project services company Clough (ASX: CLO) has acquired e2o Pty Ltd, a leading provider of specialised commissioning, completions and hazardous area inspection services to the energy and resources sectors for about $14 million.
The acquisition is expected to be Earnings Per Share accretive in the first full year of ownership. For the 2014 financial year, e2o is expected to deliver earnings of more than $5 million from forecast revenue of about $40 million.
Clough is paying $9 million on completion of the deal and another $5 million in cash and shares over a three-year period, subject to meeting certain performance criteria.
e2o is well positioned in the LNG sector, and is currently working on commissioning scopes for major LNG projects, including Chevron’s Wheatstone LNG, Origin’s Australia Pacific LNG, and Santos’ Gladstone LNG projects.
It will continue to operate under its existing management team and brand while increasing Clough’s project service capabilities.
Australia’s commissioning market has an excellent outlook with significant growth predicted in this sector in the next four years, as major LNG projects move from construction to operations.
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