AtkinsRéalis Buys Majority Stake in David Evans Enterprises in $300M Deal

Montreal-based AtkinsRéalis has inked a $300-million deal to purchase a 70% stake in Portland, Ore.-based David Evans Enterprises, with plans to completely purchase the skilled companies consulting agency at a later date, the corporate introduced Feb. 18.

The money transaction, which David Evans’ shareholders should approve, offers AtkinsRéalis a majority stake within the 1,250-person employee-owned firm and is anticipated to shut within the second quarter.

“Collectively our two companies considerably improve our geographic footprint and capabilities in a core progress market, aligning with our US … technique,” mentioned AtkinsRéalis President and CEO Ian Edwards in announcing the purchase. The funding is also a springboard to develop the 2 companies’ west coast service choices, he mentioned.

The deal is the primary “vital acquisition” for the corporate since its predecessor agency SNC-Lavalin bought U.Okay. based mostly engineer Atkins in 2017, Edwards mentioned.

David Evans has 34 places of work in 10 states and generates greater than 50% of its income, $275 million in 2024, within the transportation sector. The corporate additionally provides companies in energy, water and setting, surveying and geomatics engineering in addition to in staffing companies. The corporate ranks at No. 109 on the ENR Prime 500 Design Corporations checklist, with 64% of income in transportation and in addition lists amongst ENR’s Top 100 Pure Design companies.

AtkinsRéalis, which rebranded in 2023, ranks at No. 9 on ENR’s 2024 Top 150 Global Design Firms checklist and No. 5 on the 2024 Top 225 International Design Firms checklist.

The hyperlink between the 2 companies “is aligned with our strategic imaginative and prescient and leverages our distinctive skilled companies within the Western United States and past,” mentioned David Evans’ Chairman and CEO Al Barkouli in an announcement. He famous the companies’ “extremely complementary geographical footprints and technical experience.”

Firm workers will retain a minority stake, with the agency persevering with to function as a separate authorized entity and its management staff remaining in place, it mentioned.

“AtkinsRealis administration has beforehand signaled that it’s open to M&A – particularly within the engaging U.S. market – and the acquisition is a primary (and sure not final) foray in that route,” mentioned Maxim Sytchev, an analyst at Nationwide Financial institution of Canada in a Feb. 18 be aware. The David Evans purchase provides “vital U.S. scale to AtkinsRealis’ presence within the house [and] publicity to the thematically engaging water, setting and energy/power house,” he famous. 

“We count on a extra aggressive cadence of M&A,” Sytchev mentioned, as soon as the corporate sells its stakes in an organization that owns the Freeway 407 toll street north of Toronto, anticipated by the top of 2027, and within the Linxon JV with Hitachi Vitality that focuses on electrical substations, with each introduced in 2024. AtkinsRealis reported an adjusted lack of $2.1 million from Linxon in its third quarter however didn’t touch upon when the sale course of will full. 

The AtkinsRealis dedication of “incremental capital to M&A is suggesting the remainder of the mothership needs to be working properly to ensure that administration to spend time on integration, Sytchev mentioned. “We nonetheless consider {that a} a lot greater deal within the U.S. can be coming following the 407 ETR divestiture.”  

AtkinsRealis posted worthwhile second and third-quarter outcomes final yr, and is about to announce these for yr finish and fourth quarter on March 13.