Stephen Simpson, CFA • 15 Comments
Bumbershoot Holdings • 41 Comments
Oct. 28, 2015, 3:50 PM
- Chicago Bridge & Iron (NYSE:CBI), which jumped after hours yesterday on news it was selling its nuclear construction business, is up 15.9% today as Credit Suisse says it's time to buy.
- Shares had fallen 22% in the past six months prior to the move.
- Credit Suisse has upgraded shares to Outperform, from Neutral, and raised its price target to $51 from $45. Shares had closed at $38.96, implying 31% upside.
- The Vogle and Summer construction projects had been a significant overhang on CB&I, says Credit Suisse's Jamie Cook, over concerns about fixed-price contracts with delays and overruns. A charge of $1-$1.2B is "large," says Cook, but "we see this as a positive catalyst as the charge is now known, over, and non-cash.”
- As previously noted, CB&I's deal with Westinghouse excludes a variety of CB&I's businesses, including fosil power generation, nuclear/industrial maintenance, the MOX project and Fed decommissioning.
- Previously: Westinghouse picks Fluor to manage nuclear builds; CB&I now up 10.4% (Oct. 27 2015)
- Previously: CB&I selling nuclear construction business to Westinghouse Electric (Oct. 27 2015)
Oct. 27, 2015, 6:16 PM
- In conjunction with Chicago Bridge & Iron's (NYSE:CBI) sale of its nuclear construction business to Westinghouse Electric, Westinghouse has named Fluor (FLR -3.4%) to manage the construction of the ongoing projects.
- The work will include a pair of large projects: Vogtle Units 3 and 4 in Georgia, and two Generating Units at the V.C. Summer project in South Carolina.
- The company is beginning work immediately under a professional services deal, and management plans for construction will become effective at the close of Westinghouse's acquisition of CB&I's business.
- Fluor will book an award in its Q4 tied to taking on the two projects.
- Meanwhile, CB&I has moved up 10.4% after hours in reaction to the company's plans to sell its construction business. Fluor is flat in postmarket action.
Jan. 1, 2013, 6:28 AM
Shaw (SHAW) CEO James Bernhard last week sold 0.99M of his 1.13M shares in the company after investors approved its sale to Chicago Bridge & Iron (CBI) in a $3B deal. Bernhard has been criticized by Denali Investors, which owns 1.1% in Shaw, for agreeing on a price that was too low. Denali wants a special committee to probe Bernhard for a possible conflict of interest, speculating that he may have political ambitions that influenced the timing the sale.| Jan. 1, 2013, 6:28 AM
Aug. 21, 2012, 2:52 PMStock investors have reacted in a subdued way to recent deals (I, II, III) for oilfield services firms that should boost the earnings of buyers, including National Oilwell Varco (NOV), FMC Tech (FTI) and Chicago Bridge & Iron (CBI), Tudor Pickering analysts say. Most of the targets, such as Pure Energy, have “healthy” exposure to North America, which analysts say investors "still view skeptically." | Aug. 21, 2012, 2:52 PM
Jul. 31, 2012, 5:20 PMAnalysts aren't sold on the $3B deal combining Chicago Bridge & Iron (CBI) and Shaw Group (SHAW), as the companies have seen five downgrades between them. CBI had been viewed as a high-quality, low-risk investment, but Shaw's "lumpier results and inconsistent profitability" and exposure to nuclear power adds extra risk to its business. | Jul. 31, 2012, 5:20 PM
Jul. 30, 2012, 1:33 PMSuspicions of insider trading surround CB&I's (CBI) $3B acquisition of Shaw Group (SHAW) after a trader today made a big paper return on 2000 August $29 options that he or she bought bought on Thursday for $0.25 each. With Shaw's shares +55% to $41.40 the calls are worth $12.40. | Jul. 30, 2012, 1:33 PM | 3 Comments
Jul. 30, 2012, 10:40 AM
Fluor (FLR +0.1%) gives back most of an early pre-market pop following the announcement earlier that CB&I (CBI -14%) was acquiring Shaw (SHAW +58%) for $46 per share - a 72% premium from Friday's $26.69 close. Other peers with similar moves on the news today: URS +1%, KBR +0.8%, JEC +0.2%, ACM +1% and TTEK +0.7%.| Jul. 30, 2012, 10:40 AM
Jul. 30, 2012, 8:05 AM
More on CB&I (CBI -5.4%) acquisition of Shaw (SHAW] +66%): the deal, which is worth ~$3B, will create a company with 50K employees, a backlog of over $28B, and engineering and fabrication facilities on all continents. The firm will "become fully diversified across the entire energy sector." CB&I will use both companies' cash and $1.9B in debt to finance the agreement. Shaw will operate as CB&I Shaw.| Jul. 30, 2012, 8:05 AM
Jul. 30, 2012, 7:48 AM