Tutor Perini Corp. acquired Frontier-Kemper and plans to acquire Lunda Corp., adding significantly to its market share in heavy and civil construction, especially in the Midwest.
Tutor Perini says in a statement that it will pay $153.5 million for Lunda--$131.8 million in cash and $21.7 million in debt. In addition, Tutor Perini says there is a structured earnout based on profitability targets for three years.
The transaction is scheduled to close July 1, 2011.
Founded in 1938, Lunda Construction Co. is based in Black River Falls, Wisc. It has extensive experience in bridges and marine and railroad-related construction. The company’s plainly presented website  prominently displays the words “Bridges—Pile Driving—Dams.”
Lunda reported 2010 revenue of $360 million and ranked 143d on ENR’s Top 400 Contractors.
Until now, Lunda had remained under the control of the Lunda family, with Larry Lunda serving as chief executive.
Avram Fisher, an analyst for BMO Capital Markets, New York City, says the Lunda deal gives Tutor Perini northern Midwest geographic exposure, primarily in highways. “Lunda is highway, dam and rail contractor with experience in 30-states but significant exposure to states around Wisconsin,” he says.
Fisher characterized Lunda as a disciplined bidder. “We calculate that over the last 12-months the company has been the low-bid on roughly $130 million in work to WIDOT and $138M in low bids to MNDOT.
Tutor Perini acquired 100% of Frontier-Kemper's stock from Dellmann Haniel International Mining and Tunneling GmbH. for about $61 million in cash and assumed about $52 million of debt. Tutor Perini paid $35 million at closing.

Based in Evansville, Ind., Frontier-Kemper is known for its tunneling projects. The company reported $148.4 million in 2010 revenue and ranked 343d on ENR’s Top 400 contractors.

Frontier-Kemper will continue to operate under its current name and will be managed by its current senior management team, with W.D. Rogstad remaining as president and chief executive.

"We are eager to leverage Tutor Perini's national presence and civil expertise to expand our reach and capture new opportunities," Rogstad said in a statement.