Morrissey Goodale tracked 153 US deals in the first nine months of 2017, compared to 156 over the same period the previous year, representing a decrease of 1.9%. Deals reported in the first nine months of the year fell for the second year in a row; in 2015, the first nine months of the year saw 181 US deals.
California is the hottest state for M&A activity, with 21 deals in the first nine months of 2017. Texas was also a favorite target for acquirers, with 16 deals. California also outpaces Texas with deal activity over the latest twelve months, with 27 deals to Texas’ 22. Deal activity in The Golden State is driven by a combination of its large, diversified economy, robust population growth, and infrastructure needs and investment.
In the first nine months of 2017, 10 deals involved a seller on Engineering News-Record’s (ENR) Top 500 Design Firms list. The biggest deal in the first nine months occurred in the third quarter as Jacobs acquired CH2M, a top water design firm, in a deal that saw ENR’s #2-ranked firm acquiring ENR’s #3-ranked firm. Other notable deals included Wood Group (ENR #28) acquiring Amec Foster Wheeler (ENR #7), New Mountain Partners acquiring TRC Companies (ENR #23), SNC-Lavalin acquiring WS Atkins (ENR #37), and AE Industrial Partners acquiring CDI Corporation (ENR #38).
A review of the 2017 M&A stats through Q3 also reveals the following:
- About 24% of global deals in the first nine months of 2017 involved a publicly traded buyer. This is up from 22% during the same period the previous year. About 17% of US deals in the first nine months of 2017 involved a publicly traded buyer, up from about 12% during the same period the year before.
- In the first nine months of 2017, inter-state deal activity (defined as a firm headquartered in one state acquiring a firm headquartered in another) accounted for 58.2% of all 153 US deals, down from 62.2% in the first nine months of 2016. Though down somewhat, the data indicates a preference among buyers to use acquisitions as a tool to expand geographic reach.
- In the first nine months of 2017, 17 international firms bought into the US while only one US firm acquired abroad. International buyers from both Canada and France accounted for six deals, buyers from Great Britain accounted for two, and one deal resulted from buyers based in each of Australia, India, and Netherlands. The one international firm that sold to a US buyer was based in Australia.
- M&A activity has involved larger buyers thus far in 2017. An acquiring firm in the first nine months of 2017 generated a median of $85 million in revenue, up from $65 million over the whole of 2016.
Take a look at our AEC M&A 2017 Q3 Review Infographic.