Exit and Growth Strategies for Middle Market Businesses

M&A Quarterly News In The Engineering and Construction Industry Sector

By Peter Heydenrych | Mar 21, 2019

The report below gives a good overview of the first quarter M&A activity in the Engineering and Construction Industry Sector. M&A activity for North American based target companies in the Engineering and Construction sector for Q4 2018 included 61 closed deals, according to data published by industry data tracker FactSet.

One of the notable middle market transactions closed in October when MDU Resources Group, Inc. acquired Sweetman Construction Co, doing business as Concrete Materials Co, for an undisclosed amount. The transaction expands the construction materials business of MDU and is expected to be accretive to earnings per share. Following the transaction, Sweetman Construction and all its employees will become part of Knife River Corp, an MDU subsidiary. Sweetman Construction is located in South Dakota and provides construction materials. It employs around 260 people.

Industry Indicators

  • US corporate profits, an indicator of corporate demand for construction services, rose 10.3% in the third quarter of 2018 compared to the same period in 2017.
  • The value of US nonresidential construction spending, a demand indicator for builders, rose 4.9% year-to-date in November 2018 compared to the same period in 2017.
  • US steel mill product prices, an indicator of commodity steel product costs used in construction, rose 18.9% in January 2019 compared to the same month in 2018.

Posted by Peter Heydenrych.

Read the Entire Engineering and Construction 1st Quarter Newsletter Here

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