Zweig Group’s merger and acquisition survey found 42 percent of architecture, engineering, and planning (AEP) firms were considering buying another firm this year.
The “2015 Merger and Acquisition Survey of AEP, and Environmental Consulting Firms” sought input from a number of firms in the industry and found merger and acquisition (M&A) activity is on the rise.
According to the results, 68 percent reported M&A is in their strategic plans for the next five years. The highest-ranked reason for an acquisition was entering a new market. Further, civil engineering firms working in the commercial development market are in the highest demand.
“Mergers and acquisitions are hot in the architectural and engineering industry,” said Mark Zweig, the group’s CEO. “Whether you’re a buyer or potential seller, you’d better learn all you can about it.”
“The combination of a recent trimming of the fat in the industry, coupled with a strong outlook in the future, and access to funds means this is a great time to consider strategic acquisitions or joint ventures,” added Jamie Claire Kiser, director of M&A services for Zweig Group. “The industry’s structure continues to transform to a more integrated business model, and responding quickly and nimbly to the change. Consolidation will become increasingly common as firms seek to either serve as a ‘one-stop shop’ and provide full-service design, building, and engineering services, or seek to specialize and find niche markets to fuel growth, such as green design. The economic outlook for architects is strong over the next few years. The downstream construction markets have rebounded since the recession and new international markets are providing global growth possibilities.”