A/E Firms Showing Record Levels of Interest in Mergers and Acquisitions
A record 92% of architecture, engineering and environmental consulting firms surveyed by Natick, Mass.-based consultant, ZweigWhite, say they currently have an interest in a merger, acquisition or firm sale. That figure compares with 79% in a 2001 survey. In addition, nearly half of firms surveyed report they acquired at least one firm within the past five years, and a quarter of those acquired at least three firms.
Laura Rothman, an associate with ZweigWhite and managing editor of the 2005 Merger & Acquisition Survey of Architecture, Engineering, Planning & Environmental Consulting Firms, posits several reasons for merger and acquisition growth within the A/E industry:
Top industry leaders are aggressively—and successfully—carrying out acquisition programs. Several large firms have all made continual acquisitions an important part of their strategic growth plans.
Even small firms are getting involved in the action. Just three years ago, barely a third of firms with fewer than 50 employees reported they were interested in acquiring another firm. Now, that number has jumped to more than half.
Firms that successfully pulled through the recent economic downturn are now looking for new ways to grow. Survey respondents reported their top reasons for wanting to make an acquisition are to expand geographically and add or expand service offerings.
“With these components of continued merger and acquisition growth coming into play,” says Rothman says, “it's unlikely there will be a slowdown of merger and acquisition activity in the A/E industry anytime soon.”
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