Total deal volume by the 2026 MEP Giants eased last year, but a record share of firms got in on the acquisition action.
M&A insights
- While total acquisitions by the 2026 MEP Giants eased from 2024’s near-record pace, a record number of Giants got in on the M&A action last year.
- Sun Belt firms continue to be the most attractive M&A targets for MEP Giants.
Rather than tapping the brakes in the face of global geopolitical turmoil and economic uncertainty, Consulting-Specifying Engineer’s 2026 MEP Giants continued a strong pace of deal-making last year, even as total activity eased from 2024’s blistering pace. As a group, the largest mechanical, electrical, plumbing (MEP) and fire protection engineering firms completed 64 acquisitions in 2025 — a 7% decline from the previous year’s near-record total of 69, though still one of the most active years for the group over the past decade.
The percentage of MEP Giants making at least one acquisition climbed from 21% in 2024 to 30% in 2025 — the highest ever share recorded. Further, 15 MEP Giants closed more than one acquisition last year, up from 12 in 2024, even as the average number of deals per active buyer eased from 2024’s elevated pace.
MEP firms of all types are prime acquisition targets. According to Morrissey Goodale’s propriety database of architecture, engineering (AE) and environmental industry deals, MEP firms are commanding median valuations around seven times annual EBITDA (earnings before interest, taxes, depreciation and amortization) compared to median valuations in the range of six times annual EBITDA for engineering firms overall. The edge in valuations for MEP firms likely reflects the higher demand for firms with niche specialties in critical sectors like energy efficiency, healthcare and pharmaceuticals and especially data centers.
With MEP firms in high demand over the past year, it’s no surprise that the MEP Giants aggressively pursued acquisitions to add specialties to their service lines while sellers looked to capitalize on favorable valuations.
Global, U.S. M&A activity climbs to new highs
The deal-making surge among the MEP Giants mirrors the broader M&A boom among AE and environmental firms that’s been driven on the supply side by a wave of baby boomers and Gen-X sellers seeking capital to support growth and facilitate ownership transitions and on the demand side by strategic buyers and investors hungry for growth, talent and superior returns on investment.
Morrissey Goodale tracked 805 global industry deals in 2025 — a new record that eclipsed the previous high of 770 worldwide acquisitions in 2024 and represented a 5% increase over the previous year. In the U.S., 512 transactions were concluded in 2025, surpassing the prior all-time domestic peak of 497 deals set in 2022 and up 6% from 485 in 2024.
As with the wider AE and environmental industry, Sun Belt firms continue to be among the most attractive M&A targets for MEP Giants. With five, four and four deals, respectively, California, Florida and North Carolina were the top states where MEP Giants completed acquisitions in 2025. That was followed by Ohio, South Carolina, New York, Texas and Massachusetts with three each. MEP Giants also concluded 11 international deals, with three purchases in the United Kingdom, two each in New Zealand, Ireland and Canada and one each in Australia and Norway.
Private equity pulls back among MEP Giants
The MEP Giants continue to differ from the broader AE and environmental industry in the mix of buyer types pursuing acquisitions. Employee-owned buyers closed 43% of U.S. domestic AE and environmental industry transactions in 2025 and represented 45% of deals completed by the MEP Giants last year. By comparison, publicly traded buyers represented just 9% of overall industry transactions but accounted for 33% of MEP Giants deals in 2025.
Private equity-backed buyers accounted for just 22% of deals consummated by the MEP Giants in 2025. That was down from 29% in 2024 and well below the 47% of acquisitions attributed to them across the entire industry last year.
The pullback in private equity activity among the MEP Giants specifically is worth watching heading into 2026. In 2025, the most acquisitive MEP Giant was a private equity-backed firm, while the next tier of buyers included both employee-owned and publicly traded companies. Broader industry trends suggest private equity-backed buyers remain a fixture of the M&A market, continuing to represent a substantial share of transactions each year. It will be worth watching whether MEP-focused private equity platforms reaccelerate add-on acquisitions at a pace that brings their deal activity back in line with the rest of the industry.
Salas O’Brien most active buyer among MEP Giants
Acquisitions have long been a key growth strategy for Salas O’Brien (Irvine, California), the 2023 recipient of Morrissey Goodale’s Best M&A Post-Transaction Performance Award. Last year, the private equity-backed engineering and design firm led all MEP Giants in deal activity, completing 10 acquisitions that added more than 430 employees across nine states and Canada.
Additional MEP Giants tied for the second-most acquisitions in 2025 with five apiece were NV5 Global (Hollywood, Florida); IMEG (Rock Island, Illinois), the 2023 recipient of Morrissey Goodale’s Most Prolific and Proficient Acquirer Award; and Bowman Consulting Group (Reston, Virginia).
Other MEP Giants that completed multiple acquisitions in 2025 included WSP (Montreal), Stantec (Edmonton, Canada), LaBella Associates (Rochester, New York), CannonDesign (Buffalo, New York), Tetra Tech (Pasadena, California), McKim & Creed (Raleigh, North Carolina), Jensen Hughes (Columbia, Maryland), HDR (Omaha, Nebraska), DLR Group (Seattle), AECOM (Dallas) and Harris Company (St. Paul, Minnesota).
Despite ongoing economic uncertainty driven by geopolitical events abroad and adoption of artificial intelligence in 2026, MEP firms are looking at another year of solid revenue growth and profitability driven by sustained demand. With many CEOs reporting confidence in the year ahead, firms are capitalizing on the opportunities at hand by continuing to invest in acquisitions as a critical component of strategic expansion.
M&A activity in the AE and environmental industry set records again in 2025 and Morrissey Goodale expects deal-making to remain a defining feature of the industry in 2026. Buyers remain focused on securing expertise in public infrastructure and mission critical markets, while sellers are motivated by attractive valuations and opportunities to join larger platforms with deeper and better corporate resources. These dynamics continue to fuel deal-making, particularly in high-growth markets such as California, Florida, Texas and the Southeast. Whether the MEP Giants return to a faster pace of acquisitions or continue spreading deal activity across a broader set of buyers, as they did in 2025, will be one of the storylines to watch this year.
Read more at www.csemag.com/giants.
