ASX-listed Downer EDI has laid the foundations for a new utilities business segment by completing the acquisition of Tenix Holdings for A$300 million (US$260 million), equivalent to around 10.2 times fiscal 2014 EBIT.
Downer’s technical expertise, which has been utilised on major projects such as the Adelaide desalination project and the Luggage Point advanced water treatment plant, will be complemented by Tenix’s numerous references as a long-term O&M partner for wastewater treatment plants serving municipal and industrial clients across Australia.
Tenix – which derives around 20% of its A$800 million annual revenues from the water sector – also provides design-build services, and has been shortlisted for the rehabilitation of the Redcliffe sewage treatment plant in Queensland.
The next significant Australian asset with water exposure to change hands could be John Holland. Owner Leighton Holdings announced at the end of October that its exploration of divestment opportunities for the unit was “well progressed”.
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