CH2M Hill’s $358 million purchase of engineering firm Halcrow Group Ltd. is under review by British authorities after Halcrow employees and former employees raised concerns about the deal.
At issue is whether the Halcrow pension obligations, which Douglas County-based CH2M Hill agreed to honor, are properly funded.
“We are aware of the proposed sale of Halcrow Holdings Limited and are investigating the matter” the United Kingdom Pension Regulator, which assures the integrity of pension plans, said in a statement.
The timetable for that review is not set, Katherine Long, a spokeswoman for the regulator, said in an e-mail.
“We take a scheme-specific approach and every case is different,” Long said. “We cannot place specific time scales on how long investigations or reviews may last.”
Still, the path to complete the acquisition was cleared Wednesday when the High Court, after reviewing pension plan members’ concerns, ruled in the deal’s favor, said CH2M Hill spokesman John Corsi.
In announcing the acquisition in September, CH2M Hill said it was setting aside $101 million for the Halcrow pension system.
“CH2M Hill has committed to honoring all the obligations of the Halcrow pension scheme,” Corsi said.
The acquisition documents place the 2011 pension liability at about $100 million.
In filing with the High Court, pension plan members said a 2010 summary valuation report shows a $230 million deficit.
“One has to wonder if those in CH2M Hill who prepared the bid have done due diligence,” Stephen Brichieri-Colombi, one of the pension plan members, said in an e-mail.
CH2M Hill said it is buying Halcrow, a well-respected international firm, to extend its global reach.
Halcrow, which approached CH2M Hill, said it sought the deal because it was suffering financially.
“The decline in economic activity across a number of our business segments and markets has adversely impacted on Halcrow’s financial performance,” the company said in the acquisition documents.
