AECOM [NYSE:ACM] has received inbound interest from suitors for its management services unit that it is considering spinning off, said three sources familiar with the matter.
The Los Angeles-based engineering and construction services group is working with financial advisor DBO Partners to evaluate a potential sale of the business, these sources said. Two of these sources said AECOM has collected initial bids for the segment, which operates facilities for governments in the US and other countries.
In June, AECOM announced plans to spin off its management services segment into a standalone government services company in the second half of its fiscal 2020. The unit is expected to have around USD 4bn in fiscal 2019 revenue, according to the company.
Two of the sources said that AECOM is testing the market to see whether a sale or spin-off offers the best value to the company.
In an earnings call from earlier this month, CEO Mike Burke said AECOM will “continue to pursue every strategic opportunity in front of us” to “unlock value” in the management services unit. Asked by an analyst if AECOM had been approached by potential buyers, Burke said he could not comment, but added that AECOM is “very confident” based on “our initial dialogues” that the asset is valuable.
AECOM declined to comment beyond statements made on its earnings call. DBO Partners did not respond to a request for comment.
by Richard Tekneci and Bhavna Kaul