Caisse de dépôt et placement du Québec is investing $1.9 billion to support SNC-Lavalin Group Inc.’s global expansion projects.
The Caisse investment comes as the Montreal-based engineering company has submitted an offer to acquire all of the share capital of WS Atkins, a British design, engineering and project management consulting firm.
The Caisse transaction involves a loan of $1.5 billion, secured by the value and cash flows of SNC-Lavalin’s interest in Ontario’s Highway 407 electronic toll road. The Caisse will also acquire $400 million of equity.
Read: Governance structure ‘essential’ in federal infrastructure investment plan
“This transaction has the potential to transform SNC-Lavalin into one of the leading engineering consulting firms in the world,” said Michael Sabia, president and chief executive officer of the Caisse, in a news release. “The acquisition will strengthen the company’s position in high-growth market segments and industries, in addition to enhancing its presence in the European market.
“More than three-quarters of la Caisse’s investment is in the form of a loan backed by a very high-quality asset — Highway 407 — in addition to $400 million of equity financing. In other words, this is a well-balanced and highly attractive investment for our clients.
“While offering continued financial flexibility to SNC-Lavalin, the structure of la Caisse’s financing helps protect its capital and allows it to benefit from the future performance of the company, which is now even better positioned thanks to this acquisition.”