The new FMI report M&A Trends for Engineering and Construction confirmed that 2017 was another active year for mergers and acquisitions in the engineering and construction industry.
“Based on our most recent survey, industry participants believe the momentum will continue into 2018,” according to Alex Miller, managing director, FMI Capital Advisors Inc. “Nearly three-quarters of all respondents believe M&A activity will increase in 2018 compared to 2017, and nearly 70% of respondents indicated that acquisitions are ‘a part of (their) current strategy,’ compared to 60% last year.”
Multiple public companies in the Engineering & Construction space have recently completed share buybacks and shelf offerings that provide access to capital for select purposes. This implies that companies view their cost of equity as low and believe that they can use equity to grow their businesses – potentially through acquisition.
More than 60% of respondents FMI’s survey indicated that their ability to finance a transaction (either through available cash or access to financing) has increased in the last 12 months, and more than a third of all respondents said this increased financing ability would increase the likelihood that they would make an acquisition.
Get all the details of FMI’s M&A Trends for Engineering and Construction.
