International engineering and management consulting service provider Ricardo has bought AEA Europe, the largest British specialized environmental consultancy firm. AEA Europe and its 400 sustainability consultants spread across five locations in the UK will be integrated into Ricardo and continue as a separate business unit named Ricardo-AEA. The acquisition sum lies, according to the British media, around £18.0 million, ‘a bargain’ because AEA Europe was ‘in administration’.
Ricardo is founded in 1915 by Harry Ricardo and has been expanded to one of the biggest technical advisory firms in the world since then. Currently, more than 2,300 employees, in ten countries, are active at this multinational. In a press message, Ricardo let us know that two drivers are responsible for this acquisition. Ricardo was looking for a scale enlargement to cope with the crisis. Because of this acquisition the size of Ricardo’s business has grown with approximately 20%. Secondly, Ricardo wanted to improve its market share in sustainability consulting, one of the foremost growth markets within the advisory branche.
Financial problems for AEA Europe
AEA Europe was actively looking for an acquisition partner after it had been put in administration end of August. The firm suffered from immense high pension costs as consequence of the economic crisis. In august, its pension liability had risen to £165.5m, a burden of more than £400.000 per active employee. In the terms of the deal, Ricardo consciously ensured that historic pension liabilities and bank debts would not be transferred.
Robert Bell, managing director of Ricardo-AEA, says “I am extremely pleased that AEA Europe has become part of Ricardo. The transaction both secures the future for AEA Europe and provides a platform for its continued success and growth as a part of the global Ricardo organization”.