Tutor Perini Considers Sale Offer

Big contractor confirms board committee is evaluating a buyout

Views of downtown Seattle without the Alaskan Way Viaduct now that State Route 99 dips below downtown through a tunnel.

COURTESY WASHINGTON STATE DEPT OF TRANSPORTATION

Tutor Perini's directors are considering a buyout offer, the company reported.

According to the company, a special board committee "expects" that chief executive Ronald N. Tutor would retain his management role and remain a significant shareholder. The company (NYSE-TPC) says it has retained Goldman Sachs to serve as its financial advisor and the law firms Gibson, Dunn & Crutcher and DLA Piper to serve as its legal counsel for a potential transaction.

No further comment on the potential deal, first reported by Reuters, will be made, Tutor Perini stated. The company has booked a significant loss, mainly on fixed-price projects in fiscal 2019.

In December, a state court jury in Seattle awarded $57.2 million in liquidated damages to the Washington State Dept. of Transportation in a dispute between the agency and contractor Seattle Tunnel Partners, a joint venture between Dragados USA and Tutor Perini Corp. The award was for damages related to a multi-year shutdown of the State Route 99 tunneling project under downtown Seattle after the Hitachi Zosen-made Bertha tunnel-boring machine broke down in December 2013.

The company took a $119-million charge related to the verdict.

For 2019, including the after-tax goodwill impairment charge of $330.5 million (an impact of $6.58 per diluted share), Tutor Perini recorded a net loss of $387.7 million, or a $7.72 per share, compared to net income of $83.4 million, or $1.66 of per share, in 2018.

“Though I am not happy with the charges we were required to take in 2019," Ronald Tutor stated, "I am encouraged by our strong operating cash generation and backlog growth for the year.”

The focus in 2020 will be on delivering revenue and earnings growth from company backlog and improving operating performance in the company's specialty contractors group.

"We will also pursue various new high-margin project opportunities and continue to make progress in resolving and collecting our unbilled receivables.”

Tutor Perini operates several prominent contractors, including infrastructure company Lunda Construction and building contractor Rudolph & Sletten.

Deputy Editor Richard Korman helps run ENR's business and legal news and investigations, selects ENR's commentary and oversees editorial content on ENR.com. In 2023 the American Society of Business Publication Editors awarded Richard the Stephen Barr Award, the highest honor for a single feature story or investigation, for his story on the aftermath of a terrible auto crash in Kentucky in 2019, and in 2015 the American Business Media awarded him the Timothy White Award for investigations of surety fraud and workplace bullying. A member of Investigative Reporters and Editors, Richard has been a fellow on drone safety with the McGraw Center for Business Journalism at the Craig Newmark Graduate School of Journalism at CUNY. Richard's freelance writing has appeared in the Seattle Times, the New York Times, Business Week and the websites of The Atlantic and Salon.com. He admires construction projects that finish on time and budget, compensate all team members fairly and record zero fatalities or serious injuries.

Post a comment to this article

The Groundbreaking Women in Construction (GWIC) conference is a leading event focusing on empowering women in the construction industry through discussions on leadership, diversity, and career development.

The annual conference features a wide array of topics, including infrastructure law, sustainability, and strategies to overcome industry challenges.

Coinciding with the release of the new 2024 Top 400 Contractors list, this annual webinar dives into the results of the Top 400 survey. We'll bring together a panel of executives from the largest contracting firms to discuss the industry’s pressing issues, from workforce challenges to data security.