WSP Enters Merger Agreement with Ecology and Environment Inc.

Ecology and Environment Inc. (E & E) has entered into a definitive merger agreement with WSP Global Inc. (WSP), pursuant to which WSP will acquire E & E for cash.

“The Board is pleased to have approved a transaction that delivers significant value to E & E’s shareholders and also allows our outstanding professionals to be part of WSP, a leading global firm which is dedicated to serving our clients in solving their environmental needs,” said Marshall Heinberg, executive chairman of E & E. “The cultural fit and vision of the two organizations combined with achieving more than a 52 per cent premium for our shareholders achieves the Board’s objective of providing value and opportunities for all of our constituents.”

Under the terms of the agreement, E & E’s shareholders will receive $15.00 in cash, and a special dividend of up to $0.50, for each share of Class A and Class B common stock they own. The special dividend is conditioned on and will be paid following the completion of the transaction and is subject to downward adjustment in certain circumstances.

The merger agreement and the transaction have been unanimously approved by E & E’s Board of Directors. In addition, E & E’s founders Frank Silvestro, Ronald Frank, and Gerald Strobel, a trust affiliated with E & E’s late founder Gerhard Neumaier, each member of E & E’s Board of Directors, and affiliates of Mill Road Capital have all signed voting agreements in support of the transaction.

The merger consideration, together with the special dividend of up to $0.50, represents a premium of approximately 52.9 per cent over E & E’s closing share price of $10.14 on August 27, 2019.

“We are excited to join WSP and look forward to working together with a firm whose strategic vision aligns with our own,” said Todd Musterait, president of E & E’s U.S. operations. “E & E has a proud history of delivering excellence as a pure-play environmental firm. This path forward enables us to expand our capabilities through WSP’s global platform and allows both firms to scale our services and grow together in core and emerging markets, providing a comprehensive suite of services to our clients. Importantly, this partnership brings together industry-leading professionals from both firms and represents a tremendous growth opportunity for E & E’s talented people.”

The merger agreement provides for a “go-shop” period of 30 days, during which E & E – with the assistance of Robert W. Baird & Co. Incorporated – will contact and potentially enter into negotiations with third parties that offer potentially superior proposals to the proposed transaction with WSP. E & E will have the right to terminate the merger agreement to enter into a superior proposal subject to the conditions and procedures specified in the merger agreement. There can be no assurance this process will result in a superior proposal.  E & E does not intend to disclose developments about this process unless and until the Board has made a decision with respect to any potential superior proposal.

The closing of the transaction is subject to customary closing conditions, including the approval of E & E’s shareholders and applicable regulatory approvals. The parties are targeting a closing in the fourth quarter of calendar year 2019, subject to receipt of applicable regulatory approvals. Robert W. Baird & Co. Incorporated is acting as financial advisor to E & E and Cleary Gottlieb Steen & Hamilton LLP is serving as legal counsel.