SOURCE: CH2M HILL

CH2M HILL

May 28, 2015 07:00 ET

CH2M Welcomes Apollo as Investment Partner

Proceeds From $300 Million Investment Will Fuel CH2M's Growth Initiatives, Market Leading Positions, and Integrated Client Service Capabilities

DENVER, CO--(Marketwired - May 28, 2015) -  CH2M, a global leader in providing critical infrastructure and natural resource solutions with annual gross revenues of $5.5 billion, announced today that it has agreed to partner with an affiliate of Apollo Global Management, LLC (NYSE: APO) (together with its consolidated subsidiaries, "Apollo"), a pre-eminent alternative investment manager with a history of investing in industry-leading companies. Upon the closing of the transaction, which is expected during the second quarter, investment funds managed by Apollo will invest $200 million in convertible preferred stock in CH2M. An additional $100 million investment will occur within the one-year period following closing.

"This investment will add to our financial strength and is the right next step toward spurring CH2M's continued growth," said CH2M Chairman and Chief Executive Jacque Hinman. "There is an enormous and expanding need for the work that CH2M does so well -- solving some of the world's toughest infrastructure and natural resource challenges. The financial and strategic benefits from Apollo's investment and partnership will help us accelerate our growth, deepen our partnership with clients, push the limits on innovation, increase opportunities for our employees, and provide additional liquidity to our shareholders. This transaction will also allow us to consider innovative funding solutions to help our public sector clients meet their growing infrastructure needs."

Apollo will hold two of six independent director seats on CH2M's board of directors, while CH2M employees hold seven board seats.

Since the late 1880s, CH2M and its legacy companies have been providing clients with world-class infrastructure and natural resource solutions. In recent years, the company's services have enhanced quality of life for tens of millions of people around the globe. Example projects include:

  • Pioneering work in water conservation and reuse, for more than 200 cities, agencies and industries around the world
  • Implementation of urban regeneration and "smart city" solutions, such as Shendra-Bidkin along India's Delhi-Mumbai Industrial Corridor
  • Management of major decommissioning and nuclear remediation efforts in the US and Europe
  • Implementation of critical infrastructure and development solutions throughout the energy value chain, from oilfield services on Alaska's North Slope to sour gas development in the Middle East

"Apollo has substantial expertise and a track record of success in making strategic equity investments in strong operating companies, including in the infrastructure and natural resources arena," said Hinman. "But just as important for us, Apollo is a great cultural fit. Our dedication to strong values in corporate citizenship, ethics, safety and sustainability is highly valued and shared by the Apollo team."

Apollo was formed in 1990 and currently has $163 billion in assets under management. Socially responsible investing is a core tenet of Apollo's investment philosophy.

Antoine Munfakh, the lead investment partner for Apollo on this transaction, added: "CH2M is a marquee franchise with a century-long history of pioneering innovative infrastructure solutions for its clients. Today, CH2M remains a market leader serving attractive end markets with compelling opportunities for both domestic and global growth. The company's success results from an incredibly deep bench of employee talent, and we look forward to bringing Apollo's resources to bear in furthering that success and helping the company achieve its strategic objectives. The world has critical infrastructure and natural resource needs, and we believe Apollo and CH2M will be great partners in addressing these global challenges." Mr. Munfakh will join CH2M's board of directors at closing, along with one additional Apollo designee.

CH2M employs more than 25,000 of the industry's best professionals and operates in more than 90 countries. CH2M is consistently recognized as one of the world's top engineering firms by Engineering News-Record and was recently named one of the "World's Most Ethical Companies" for the seventh consecutive year by the Ethisphere Institute.

About CH2M

CH2M is a global engineering and project delivery company partnering with public and private clients to tackle the world's most complex infrastructure and natural resource challenges. The firm's work is concentrated in the water, transportation, energy, environment and industrial markets. CH2M has gross revenues of $5.5 billion, has 25,000 employees and is a specialist in program, construction and operations management and design. For more information, visit www.ch2m.com.

About Apollo Global Management

Apollo is a leading global alternative investment manager with offices in New York, Los Angeles, Houston, Chicago, Bethesda, Toronto, London, Frankfurt, Madrid, Luxembourg, Mumbai, Delhi, Singapore, Shanghai and Hong Kong. Apollo had assets under management of approximately $163 billion as of March 31, 2015 in private equity, credit and real estate funds invested across a core group of nine industries where Apollo has considerable knowledge and resources. For more information about Apollo, please visit www.agm.com.

FORWARD-LOOKING STATEMENT CAUTION

All statements in this press release other than statements of historical fact are "forward-looking statements" for purposes of federal and state securities laws, including any projections of growth, earnings, revenue, cash flows, tax rate, share count or other financial items; any statements of the plans, strategies and objectives for this preferred stock investment and future operations; and any statements regarding future conditions or performance. Although we believe that the expectations reflected in our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. You should not place undue reliance on our forward-looking statements. Important factors that could cause our actual results, performance and achievements or industry results to differ materially from estimates or projections contained in forward-looking statements include, among other things: uncertainties related to global economic conditions and infrastructure funding; audits; modifications and termination of long-term client contracts; losses under fixed-price contracts; our limited control over operations run through our joint venture entities; misconduct by our employees or consultants; our failure to comply with laws or regulations; failure to successfully execute our strategy and plans; failure to recruit or retain key technical and management personnel; and unexpected adjustments and cancellations related to our backlog. Additional factors that could cause actual results to differ materially from our plans and expectations expressed in our forward-looking statements are set forth in our filings with the Securities and Exchange Commission (SEC) and the UK Financial Conduct Authority, including our most recent prospectuses, our Annual Report filed on Form 10-K and our Quarterly Reports filed on Form 10-Q where you will find a detailed list of risk factors. You can find these filings on our stockholder information website at www.ch2mstockholder.com and on the SEC website at www.sec.gov. We do not intend, and undertake no obligation, to update any forward-looking statement.