AECOM Technology Corp., Los Angeles, is finishing up final details of a planned acquisition of EDAW Inc., the San Francisco-based architect-planner. It will give AECOM a foothold in the fast-growing global market for project master planning, according to officials of both firms who confirmed the deal.
Neither the purchase price nor other financial details of the transaction were released, but one official says it involved a combination of cash and stock. The transaction will allow EDAW management access to shares of the larger AECOM company and permit more EDAW staff down the ladder to become company owners.
Sources say EDAW had other suitors, but Amanda Walter, EDAW's communications manager, would not identify them. "We were approached by several firms," she says.
AECOM is the industry's third largest design firm, reporting nearly $2.1 billion in global design revenue in 2004, according to ENR's Top 500 Design Firms, with 22% in buildings-related work. AECOM has been growing through acquisitions steadily over the past five years and at one point considered a public stock offering before pulling it back. This summer, AECOM acquired environmental engineer ENSR International, Westford, Mass. AECOM has contracting operations, too. Last month, AECOM decided to buy most of the assets of Cleveland-based The Austin Co. following a bankruptcy filing by Austin. This would boost the companys market share in design-build services.
EDAW is ranked 67th on that list, reporting $137.5 million in design revenue. About 21% of the firm's total is from the building market and the firm also performs much landscape design and environmental services.
The company has over 1,000 staff members and is no stranger to its own acquisitions, having absorbed nine other firms since 1992.
Officials say both company boards have approved the deal and that it has already been communicated to their respective employees. Company's shareholders have not yet voted on the transaction, says Walter.
One senior AECOM official says the firm currently lacks a strong planning function. "EDAW has that in a big way," he says, with strong credentials in Australia, the U.K and China. "Our two global footprints match, and EDAW offers an early look into projects. We've been pushing for a planning acquisition for a long time."
Among other things, EDAW has advised London development officials since 2003 on planning for the 2012 summer Olympic games, which the city went on to win earlier this year. The firm is now proposing to do the actual master plan.
"We were looking for additional resources for large jobs," says EDAW's Walter. "AECOM already has offices where we need to grow." She notes that EDAW recently opened an office in Singapore, where AECOM is already located. EDAW will become another AECOM operating company, with Joe Brown, its president and CEO, joining AECOM's board.esign giant AECOM is acquiring EDAW, the big planning firm, ENR has learned.