In what would be its largest addition, New York City-based contractor STO Building Group Inc. said on Dec. 4 that it has signed an M&A deal under which Layton Construction Co. LLC, a Sandy, Utah, building construction firm with 1,000 employees, would become part of the new parent's expanding growth platform.
The company did not release financial details of the transaction between the two privately held firms, set for completion at month's end.
But it says Layton—which ranks at No. 44 on ENR's list of the Top 400 Contractors, reporting $1.8 billion in 2018 revenue—would retain its name, branding and senior leaders. About 97% of Layton's revenue is in the building sector, with 84% performed as CM-at-risk.
STO ranks at No. 14 on ENR's Top Contractors list, reporting $4.9 billion in 2018 revenue, with 86% in the buildings sector and 10% in telecom.
The companies say the transaction would allow them to leverage each other’s geographic reach to better serve clients with multiple locations. "We respectively operate in places and sectors the other doesn’t, so opportunities go both ways," says an STO spokeswoman. "We expect to also work together on projects for clients with a national or global footprint."
"This is the next logical step in our evolution,” says David S. Layton, Layton president and CEO.
When completed, Layton's current owners, which includes about 100 senior executives and family members, will be shareholders in STO's parent organization, Global Infrastructure Solutions Inc., an investor group.
The new arrangement also will allow Layton to extend ownership potential to a broader employee base.
“Opportunities like this with Layton are the very reason we shifted our company structure to STO Building Group last year,” says James Donaghy, the firm's executive chairman. It was formerly known as Structure Tone.
Since 2016, Structure Tone added Canada’s Govan Brown to enable it to work throughout that country, while the firm’s addition of Florida-based Ajax Building Corp. and California-based BCCI Construction expands its reach into public facilities and into new geographies.
>STO has more than 2,200 employees located in the US, Canada, UK, and Ireland, it says.