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Engineering Firm Fluor to Buy Del-Jen to Gain U.S. Contracts

January 28, 2003|From Bloomberg News

Fluor Corp., the world's largest publicly traded engineering and construction company, agreed Monday to buy Del-Jen Inc. to gain the company's U.S. government maintenance and engineering contracts.

Fluor didn't disclose the price, saying the acquisition fit its plan to buy niche companies for about $50 million.

Closely held Del-Jen performs maintenance for military bases and training services for the Labor Department. The company, based in Rolling Hills Estates, employs 1,500 and expects to have 2003 sales of about $140 million.

Fluor, based in Aliso Viejo, is expanding its services to cope with declining demand from power-generation customers, which are canceling or delaying power-plant projects. The purchase, expected to close Friday, would not affect earnings this year.

The company's largest business, energy and chemicals, had 2001 sales of $2.5 billion, or 28% of total revenue, while government services revenue accounted for 9%, or $813 million, spokesman Jerry Holloway said. Last year, government services revenue rose to $1 billion, Fluor said. Fluor shares fell 46 cents to $27.60 on the New York Stock Exchange. They have fallen 15% in the last year.

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