Environmental consultancy RPS Group acquired by WSP
Montreal-headquartered design and engineering consulting firm WSP Global has announced a deal to purchase UK consultancy RPS Group. The deal is reportedly worth close to $1 billion, and is WSP’s third major takeover in the last three months.
Demand for environmental engineering and consulting services is growing as private-sector companies and governments seek advice on things ranging from climate-change risks to waste management. With companies rearranging their operations and recovering from the Covid-19 impact, the global environmental consulting services market size is expected to grow from $56.39 billion in 2021 to $63.03 billion in 2022, according to a recent The Business Research Company study. at a compound annual growth rate (CAGR) of 11.8%. The growth in the environmental consulting services market is mainly due to the. Assuming this demand remains, revenues could hit $93.61 billion in 2026.
Amid this surge in need for environmental consulting, WSP Global is beefing up its capabilities in the space as part of a wider growth effort. In June 2022, the firm struck a definitive agreement to acquire a business known as Environment & Infrastructure (E&I) from Scottish consultancy Wood for $1.8-billion, adding another 6,000 employees to its payroll. Meanwhile a month later, it said it would buy Capita’s REI and GL Hearn businesses in the UK, for £60 million.
Now, the Canadian conglomerate has announced it will add British environmental consultancy RPS Group to its business, in a move worth nearly $1 billion. WSP is buying RPS for £2.06 per share in cash for a total enterprise value of £625 million, or $975 million. Illustrating how insistent WSP was on completing the move, the deal will possibly see it pay 15 times RPS’s adjusted earnings before interest, taxes, depreciation and amortization for the 12 months to the end of June 2022.
“We are pleased to announce the proposed acquisition of RPS as it will enable us to rapidly deliver on our Global Strategic Action Plan and create value for all our stakeholders,” commented Alexandre L’Heureux, President and Chief Executive Officer of WSP. "We are proud that we are building a strong ESG leader with significant capabilities in water and energy and contributing significantly towards the transition to a greener and low-carbon world.”
Founded in 1970, RPS is a global professional services firm, providing specialist services to government and private sector clients, with a focus on front-end consulting. Generating approximately $875 million in revenue, the company was recognised in 2021 as one of the first “carbon champions” by the Institution of Civil Engineers.
When completed, the deals for Capita REI and GL Hearn, Wood and RPS will bring WSP’s revenue to $10-billion a year on a pro-forma basis, and boost its workforce to approximately 70,000, with approximately 23,000 environmental experts across the globe. Around 5,000 of those staff will arrive from RPS.
