There's been a whole lotta acquisition going on in the AEC industry lately. “Last year was an all-time high,” says George Christodoulo, senior partner with Boston law firm Lawson & Seitzen, whose firm handled 29 such M&As in the last year or so.
Examples: URS gobbling up 25,000-person engineering/CM firm Washington Group International for $3.1 billion. Jacobs grabbing 3,200-person Carter & Burgess, after C&B had gone on a spree buying up water engineering companies.
The list goes on: Perkins+Will snagging corporate interiors firm The Environments Group. RDK Engineers buying PWI Consulting Engineers—Southeast. AECOM taking over Earth Tech. Stantec (9,000 employees) nabbing 700 environmental engineers at SECOR International. Cordell Spencer buying healthcare design firm Marshall Erdman.
Then there was Hewlett-Packard buying EYP Mission Critical Facilities to merge H-P's hardware/software expertise with EYP's data-center design capability. And how about financial/real estate manager Jones Lang LaSalle picking off ECD Energy, developer of the Green Globes rating system, to strengthen its foothold in green building?
Why all this activity? Some of it has to do with the devalued dollar, which made it enticing for Dutch engineering giant Arcadis to snatch up RTKL and LFR, and for the U.K.'s RMJM to acquire Hillier.
A lot has to do with Wall Street's expectations of publicly held AEC firms. “Jacobs told the stock market that it's going to grow 15% a year and maintain 10% profitability, so they have to buy two Carter & Burgesses in the next year to make good on that promise,” says BD+C Editorial Board member Laurin McCracken, AIA, who should know: He's the chief marketing officer at Jacobs Carter Burgess.
Stephen A. Gido, CFA, who monitors the M&A scene for ZweigWhite, says in a new report (www.zweigwhite.com ) that there may be a slight 10-15% slowdown in M&A this year, but that's on top of 2007 being “the strongest [year] we've seen in decades.”
If your firm does get acquired, here's solid advice from Christodoulo and McCracken:
Sit tight. Acquisitions usually take 12-24 months to sort out. Exude positive vibes and keep your nose to the grindstone.Remember, the AEC industry is a “people” business. The acquiring entity bought your firm to gain new expertise or a new geographic beachhead. They want your brains, energy, and experience. Hard-working, dynamic managerial, technical, and field people (that's you, of course) are invaluable assets to the new owner.It's OK to ask reasonable questions: Will my benefits or pay scale change? Will I be in the same office? To whom do I report?Career opportunities may be grander at a big firm. Your next project could be in Doha. Younger staff with “lifestyle flexibility”—i.e., single, no mortgage, no pets—might be in for new adventures. Go for it!Don't assume big is bad. Big firms have the resources to weather downturns in the economy. They may even have better management than your old firm. Give them a chance. You may be in for a nice surprise.