M&A Corner: Two Engineering Firms Add Water Units

The tristate region's already heated up merger and acquisition marketplace is getting hotter with recent announcements of two separate engineering deals focusing on water resources. Louis Berger has acquired Leidos Engineering LLC's Water and Waste Resource unit, and Tata & Howard Inc. bought civil engineering consultancy Roald Haestad Inc. (RHI).

Terms were not disclosed for either deal. They follow WSP Global Inc.'s announced plan to buy Parsons Brinckerhoff from Balfour Beatty for $1.35 billion.

Louis Berger's U.S. operating arm, Morristown, N.J.-based Louis Berger Group, will integrate the acquired unit. The deal adds to the group's water practice, expands its geographic presence and strengthens "Louis Berger's global technical expertise in the water market sector," said Thomas Lewis, Louis Berger Group president in a Sept. 2 statement.

Neil Callahan, formerly head of Leidos' water practice, has been named a vice president and manager of Louis Berger's water and waste resources division.

Meanwhile, both T&H and RHI specialize in water-related consulting engineering services and are based in Waterbury, Conn.

T&H focuses on water, wastewater, stormwater and hazardous water engineering. The deal bolsters its business by providing additional civil engineering services including dam engineering, surveying and streamflow release analysis, Donald J. Tata, T&H co-founder and president, said in an Aug. 27 statement.

Tata adds that T&H will retain RHI's Waterbury office and employees, although RHI president, Ronald G. Litke, will retire and remain available on a limited basis.

"The acquisition significantly adds to our talent base and also expands our geographic presence in New England," Tata says.

In another deal, Canada's WSP says it plans to close the acquisition of New York City-based PB by the end of the fourth quarter. PB was ranked No. 3 this year on ENR New York's list of Top Design Firms, with $172.70 million in 2013 regional revenue; PB ranked No. 24 on Engineering News-Record's Top 150 design list, with $1.72 billion in global design revenue last year.

Earlier this year, AECOM Technology Corp. purchased Hunt Construction Group for an undisclosed sum. The announcement came on the heels of AECOM's announced plan to buy URS Corp. for $6 billion in cash, stock and assumption of debt. The AECOM-Hunt transaction, which is set to close in October, would create a firm with 95,000 employees and pro forma revenue of $20 billion.

new york

Panel: MTA Safety Improvements Needed

A Blue ribbon panel of transportation professionals studying safety and maintenance practices at the Metropolitan Transportation Authority's (MTA) three railroad operations says safety improvements are needed. MTA created the panel last year after a deadly Metro-North Railroad derailment—its third in a year—in the Bronx.

The panel studied Metro-North as well as the Long Island Rail Road (LIRR) and New York City Transit. All three railroads have persistent rail conditions that require sustained management attention, the panel said in its findings. It concluded that a confidential close-call reporting system would provide Metro-North and LIRR with a better opportunity to "understand safety risks before they lead to incidents."

It also found that each needs to implement data systems to monitor all track elements through their life cycles and integrate data to give employees the best understanding of track asset conditions.

The panel suggests that the three railroads should do more to share information and practices with each other, "specifically acknowledging the robust safety culture within New York City Transit, which should be a model to Metro-North and the LIRR," MTA says.

"During the course of the panel's work, the MTA made substantial changes to address these issues in response to the panel's interim findings, as well as to findings by the National Transportation Safety Board, the Federal Railroad Administration and a Transportation Technology Center Inc. (TTCI) review of Metro-North operations," MTA says.

The agency adds that Metro-North is reviewing TTCI's technical reports that recommend changes to how the railroad inspects and maintains its tracks, and how it manages all areas of track maintenance. It adds that Metro-North has either begun implementation or fully implemented many of TTCI's recommendations.

The panel found that Metro-North's emphasis on on-time performance did not leave employees with enough time to perform necessary inspection and maintenance work on the tracks. It encouraged the railroad to automate its process for assessing track conditions and use that data to inform maintenance planning.

The panel made 29 specific recommendations in all after studying the rail network, interviewing employees from front-line workers to executives, attending safety training and visiting work sites.