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SAN FRANCISCO (AP) _ Engineering giant URS Corp. said Wednesday it has agreed to acquire the Carlyle Group’s EG&G Technical Services Holdings LLC, in a transaction valued at about $500 million.
The deal will merge URS, with about $2.4 billion in annual revenue and 16,000 employees, with EG&G, with $850 million in annual revenue and about 10,000 employees.
Under terms of the pact, which is expected to close in the fiscal fourth quarter ending Oct. 31, URS will assume about $165 million in the smaller company’s debt while paying EG&G’s shareholders about $165 million in cash, $130 million in URS common stock and $40 million in preferred stock.
URS, based in San Francisco, specializes in the front-end of defense projects, such as engineering design and planning.
EG&G, based in Gaithersburg, Md., is a leading provider of outsourced engineering, technology and operations management services.
Upon completion of the deal, EG&G is to operate as a wholly owned division of URS. The company’s president and chief executive officer, George Melton, is to join the URS board and continue overseeing EG&G.
EG&G is currently owned by affiliates of The Carlyle Group and includes the operations of Lear Siegler Services Inc.
Both URS and EG&G already serve many of the same federal government clients, including the General Services Administration, NASA, the Environmental Protection Agency, and the Departments of Defense, Transportation, Treasury, Justice, and Energy.