Stantec to buy Burt Hill, extends acquisition push
* Stantec's ninth acquisition this year
* Burt Hill annual revenue $60 mln analyst estimates
* Stantec shares rise 2.9 pct on TSX to C$26.80 (In U.S. dollars unless noted)
OTTAWA, Sept 9 (Reuters) - Canadian engineering firm Stantec Inc (STN.TO) (STN.N) said on Thursday it plans to acquire Pennsylvania-based engineering and architecture firm Burt Hill, advancing its North American expansion drive.
Financial terms of the deal were not disclosed. Burt Hill, which has more than 600 employees in 13 offices, is considered a U.S. leader in school and health-care facility design, Stantec said.
Stantec has already struck eight acquisition deals this year, adding about 740 staff to its 10,000 employees.
"It makes a lot of sense to acquire in this space because architecture and engineering are extremely fractured (sectors) in North America," NCP Northland Capital Partners analyst Maxim Sytchev said.
"Stantec is a sizable firm, but they have only 1.5 percent market share in North America. So obviously there are a multitude of firms that Stantec can take over."
The industrial and infrastructure analyst estimates Burt Hill's annual revenue at $60 million and Stantec's purchase price at $38 million.
Edmonton, Alberta-based Stantec posted C$1.5 billion in gross revenue in 2009, up from C$1.35 billion the previous year.
The company recently said it would buy San Francisco-based architecture firm Anshen + Allen, which has 200 staff and focuses on health care design.
"The combination of Stantec, Burt Hill, and Anshen + Allen will create a new global architecture practice with world class expertise in our key market sectors, particularly health care, education, and science and technology," Stantec Chief Executive Bob Gomes said.
Stantec shares rose 75 Canadian cents to C$26.80 on the Toronto Stock Exchange on Thursday morning, a 2.9 percent climb. In New York, the stock rose 3.8 percent to $25.92.
RBC analyst Sara O'Brien increased her 12-month stock-price target for Stantec to C$33 from C$32 on Aug 31 to reflect recently announced acquisitions. "We expect the momentum to continue," she said in a note.
($1=$1.03 Canadian) (Reporting by Susan Taylor; editing by Peter Galloway)
- White House reverses, says Obama met uncle and lived with him during law school
- South Africans, some fearful, wake to life without Mandela |
- U.S. television, Twitter, alive with new version of 'Sound of Music'
- Ford leans on global Mustang to burnish overseas image
- RPT-UPDATE 1-Ford leans on global Mustang to burnish overseas image