The Engineering Services market is in the midst of a new consolidation cycle against a backdrop of accelerating investor interest and powerful sector fundamentals, according to a new industry report released by the Industrial & Infrastructure Services investment banking team from Brown Gibbons Lang & Company (BGL).
The report contains exclusive interviews with leading engineering services industry executives from Parsons, Trilon Group, DCCM, Arora Engineers, and The Office of Milo Riverso, who share compelling insights on high-growth infrastructure markets that are fueling demand for services and driving a highly active engineering services M&A market. Key takeaways include:
- Demand for specialty engineering consulting services is expected to remain strong, with long-term mega trends of the federal infrastructure bill rollout, 5G telecom deployments, and carbon-reducing energy transition investments pointing to a multi-decade spending cycle to repair and upgrade aging U.S. infrastructure.
- Labor remains a key challenge amid a talent shortage for Engineering Services firms, a challenge which investments in human capital, operational efficiencies, and technology are helping to address.
- A favorable demand outlook, along with high industry fragmentation and significant inflows of institutional capital, are predicted to keep Engineering Services M&A activity strong over the coming years, with strategic and financial buyers continuing to seek acquisitions to expand capabilities, enter new geographies, and service record backlogs.