A $3 Billion Deal Forms New Power Plant Player

Chicago Bridge & Iron Co. agreed to buy rival Shaw Group Inc. in a $3 billion deal that will create one of the world’s biggest energy infrastructure companies.

The combined company, to be called CB&I Shaw, will be involved in everything from building nuclear power plants in the U.S. and China to constructing gas-processing plants and oil storage tanks globally.

It will have a $28 billion order backlog of projects in the oil, gas and electric industries, including about $18 billion coming from Louisiana-based Shaw, one of that state’s largest and most politically influential firms.

“We’ve got a great backlog in front of us,” said Philip K. Asherman, chief executive of CB&I, which is headquartered in The Woodlands, Texas.

Mr. Asherman described Shaw in a conference call as an attractive “bolt on” acquisition that will give CB&I, which is more focused on the oil-and-gas-business, better access to lucrative and potentially growing projects in the electric-power industry.

Utilities in coming years are expected to spend billions of dollars building new power plants and retrofitting coal-burning plants to meet tougher antipollution regulations.

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