Bosses at some weapons complex contractors expect the proposed merger of Amentum and the government contracting wing of Jacobs Solutions will hurt competition on federal nuclear cleanup jobs — and cite a $45-billion liquid waste contract at the Department of Energy’s Hanford Site as an example.
Exchange Monitor discussed the announced merger by phone Monday with two executives from large contractors and one at a smaller contractor. They said the merger could produce competitive disadvantages stretching from the Hanford Site in Washington state to the West Valley Demonstration Project in New York state.
Litigation continues in federal courts on the Hanford Integrated Tank contract. Jacobs and Amentum are on opposite sides of that dispute and have been since well before they announced merger plans last week.
On one side is BWX-Technologies-led Hanford Tank Waste Operations & Closure, the team that won the contract and which also includes Amentum and Fluor.
On the other is Hanford Tank Disposition Alliance, a joint venture of AtkinsRéalis Nuclear Secured, Jacobs and Westinghouse. The BWXT-led group won the big award, but the Atkins-led group sued and convinced a federal court to make DOE reconsider the award.
Other sites could be affected too.
On the other side of the country, DOE has said it could issue the final solicitation for the next phase of West Valley remediation in December. The business could be worth up to $3 billion. Two sources said Amentum and Jacobs were both planning, at least prior to last week, to lead teams for the successor contract to the one held by a team of Jacobs’ affiliate CH2M and BWXT. BWXT was rumored to be leading the third team.
The new Amentum-Jacobs contracting combination would be a “fierce competitor” that can “go after anything and everything,” one of the three industry sources said.
“It’s very harmful to the competitive environment,” said another of the industry sources.
For small contractors, it means “one less big team to get on,” said the third industry source.
Officials with the two companies said last week they hope to complete the merger in mid-2024. According to a Jacobs 8-K report filed with the Securities & Exchange Commission.
Either company can cancel the merger if it is not consummated within 13 months of Nov. 20, 2023, which would translate to about Dec. 20, 2024.
Jacobs CEO Bob Pragada said last week he does not expect the Federal Trade Commission to delay the merger on antitrust grounds.