Two Private Equity Firms Buy Management Services Arm of AECOM

The AECOM deal is a win for activist hedge fund Starboard Value

Private equity firms Lindsay Goldberg and American Securities are buying assets from construction giant AECOM.

The target company issued a report this morning saying it agreed to a deal worth $2.4 billion for its management services division. That arm of the company provides logistics and technical services to the Federal government.

Its customers also include the Department of Defense and the Department of Energy. It also provides services to departments and agencies of allied governments. This list includes the U.K. Nuclear Decommissioning Authority and the U.K. Ministry of Defense. Its competitors include Jacobs Engineering Group and KBR.

“The Management Services business is a proven industry leader with distinctive expertise that plays a vital role in supporting governments around the world to execute programs of critical importance,” said Russell Triedman, Partner at Lindsay Goldberg. “We intend to leverage our extensive experience investing in the government services sector, including our prior investments in PAE and ECS Federal, and we look forward to working alongside management and American Securities to thoughtfully grow the Company and its capabilities both organically and through strategic transactions.”

Private Equity Firms Find Value in AECOM assets

Meanwhile, the sale is a win for activist hedge fund Starboard Value.  The hedge fund had further pushed the firm to conduct a strategic review of its assets. Starboard owned roughly 4% of the company in June.

At the time, the fund delivered a letter to AECOM Chairman and CEO Michael Burke. Starboard specifically mentioned its management services division as a potential source of value.

Finally, shares of AECOM stock (NYSE: ACM) added more than 6.4% during Monday’s trading session.

[Related: Hedge Fund Starboard Value Gets Papa John’s a New CEO]

Free Industry News

Subscribe to our free newsletter for updates and news about alternatives investments.

  • This field is for validation purposes and should be left unchanged.


Alt Insights

January 16, 2020

ESG: Lately-turned Tesla Bull Jim Cramer Adds Fink To The Mix

ESG: Lately-turned Tesla Bull Jim Cramer Adds Fink To The Mix
Shape

Latest Alternative Investment News

Hedge Fund Performance Update: December 2019
January 21, 2020     Hedge Funds, Investments, News

Hedge fund performance was strong at the end of 2019. The Preqin All-Strategies Hedge Fund benchmark returned +2.00% in December, bringing the 2019 return to +11.58%. Funds of hedge funds gained…

Hedge Funds are Selling Oil Again
January 21, 2020     Hedge Funds, Investments, News

NYMEX and ICE WTI data show that hedge funders were net sellers of crude oil for the week ending January 14. Funds sold roughly 99 million barrels in the six…

Digital Assets: UAE a Flag-bearer for Blockchain Technology Deployment
January 20, 2020     Digital Assets, News

The UAE is a Flag-bearer for Blockchain Technology Deployment. A joint white paper has been issued by the World Economic Forum and the United Arab Emirates’ Centre For The Fourth…

Digital Assets: Bitwise/ETF Trends 2020 Survey – 65% Advisors Want to Buy Bitcoin in an ETF
January 20, 2020     Digital Assets, News

The Bitwise / ETF Trends 2020 Benchmark Survey of Financial Advisor Attitudes Toward Cryptoassets gives useful insight into what advisors are thinking about Bitcoin and cryptos going into 2020. ETFs…