British engineering firm Amec said on Monday it had provisionally agreed to buy Foster Wheeler in a cash and share deal that values the Swiss-based engineer at 1.9 billion pounds ($3.13 billion).
Amec said the deal would improve its geographical footprint by more than doubling its revenues in faster-growing regions, and would add mid- and downstream capabilities to its existing upstream focus.
(Read more: AMEC CEO flags barriers to UK fracking)
Under the offer terms, Amec said Foster Wheeler shareholders would receive approximately 0.9 Amec shares and $16 in cash, representing $32 for each Foster Wheeler share. Shares in Foster Wheeler closed at $31.46 on Friday.
Should the deal complete, Foster Wheeler will hold shares in Amec representing 23 percent of the enlarged company, and Amec would seek a U.S. listing in connection with the transaction, the companies said.
(Read more: US oil, gas juggernaut on course through 2016: EIA)
Foster Wheeler said it had agreed with Amec not to solicit alternative proposals up to Feb. 22, and would pay out a one-time dividend of $0.40 per share prior to closing should the companies close the deal.
