US contractor Jacobs Engineering (Dallas, Texas; www.jacobs.com) is selling its Energy, Chemicals and Resources (ECR) division to Australia’s WorleyParsons (Sydney; www.worleyparsons.com) for USD 3.3 bn. Jacobs said it initially plans to invest the USD 2.6 bn in net proceeds from the transaction to pay down debt. On the deal’s closing – expected in H1 2019 – it will pay USD 700m to acquire just over 58.2m in WorleyParsons shares, giving it an 11% stake in the company.

With its latest move, the Australian contractor, with 2017 sales of AUD 4.75 bn (EUR 3.01 bn) will double in size, reports said – Jacobs does not break out figures for ECR. Altogether, Jacobs reported sales of USD 15 bn in 2017 after consolidating revenue of CH2M, a design and engineering firm specialising in infrastructure for petroleum and chemicals projects acquired last year for USD 3.27 bn including debt.

WorleyParsons CEO Andrew Wood said the purchase will give his company complementary capabilities in key business lines, including a best-in-class onshore and downstream maintenance, modifications and operations (MMO) capability for hydrocarbons projects. The Jacobs activities, which employ nearly 31,000, are concentrated mainly in the US, the Middle East and Canada.

Following completion of the sale, Jacobs said it will focus solely on its two business lines of aerospace, technology, environmental and nuclear (ATEN) and buildings, infrastructure and advanced facilities (BIAF), which have higher margins and higher growth rates. CEO Steve Demetriou said the increased financial flexibility will better position the company to invest in the two businesses catering to infrastructure and government services clients.

Separately, WorleyParsons has signed a five-year engineering, procurement and construction management (EPCM) framework agreement with Saudi Arabian petrochemicals giant Sabic (Riyadh; www.sabic.com). Under the terms, WorleyParsons’ offices in the UK, the Netherlands, Germany and Spain will work to optimise operating efficiency at five of Sabic’s European production sites. The contractor said the arrangement will support its own plans to lift its profile in Europe.