AtkinsRealis to buy 70 per cent stake in Portland-based David Evans

AtkinsRealis headquarters are seen in Montreal on Nov. 10, 2023. (Christinne Muschi/The Canadian Press)

Montreal-based engineering firm AtkinsRealis is on solid enough financial footing to resume acquisitions, its CEO said Tuesday, after the company announced it had made a US$300-million deal to expand its footprint in the western United States.

After markets closed, the company formerly known as SNC-Lavalin said it would acquire a 70 per cent stake in David Evans Enterprises, a Portland, Ore.-based firm specializing primarily in the transportation sector. AtkinsRealis may acquire the remaining 30 per cent stake “within a defined agreed time period,” the company said in a news release.

The deal marks the first “significant acquisition” for the company since SNC-Lavalin purchased Atkins in 2017. “We’re very excited to be able to come back to (mergers and acquisitions),” Ian Edwards, president and CEO of AtkinsRealis, said in an interview.

“It’s taken us a while to strengthen the balance sheet, but we’re here now, we’ll be like a normalized company in terms of investing back into the business.”

As of September, the company had a debt-to-equity ratio of 1.4 times earnings before interest, taxes, depreciation and amortization. Management is aiming for the ratio to be in the 1-2 range.

Before changing its name to AtkinsRealis in 2023, SNC-Lavalin had a turbulent decade marked by ethical issues, underperformance of its operations, including an ill-advised acquisition in the oil sector, and cost overruns on turnkey contracts.

“We’re generating cash now, so we intend to continue to make acquisitions,” Edwards said.

AtkinsRealis has a strong presence in the southern United States. The acquisition of David Evans allows it to expand its footprint to the American West. “We needed to expand into other regions.”

David Evans has 34 offices in 10 states and approximately 1,250 employees. The combination of the two firms will allow the Montreal company to increase its workforce by 25 per cent in the United States.

The American firm generates annual revenues of nearly US$275 million, which represents almost five per cent of the revenue generated by AtkinsRealis’s activities in 2023, excluding fixed-price contracts.

David Evans generates more than half of its revenues from the transportation sector. It also serves the energy, water and environment, surveying and geomatics, and land use planning sectors, as well as staffing services.

Edwards sees growth prospects in the American market favourably. The United States, he said, “is very much like Canada and Europe, in that a lot of the infrastructure, whether it’s road, bridges, rail, water infrastructure, flood defence infrastructure, was all built in the ’50s and ’60s, and it’s at end of life.”

The businessman is not worried about the effect that the Donald Trump administration’s budget choices could have on the company’s activities. He points out that a large part of the contracts are awarded by the states. “These are essential works, if we want to keep cars on the roads, run trains or drink clean water.”

The company expects the transaction to close in the first half of the year.

AtkinsRealis is due to release its fourth-quarter results on March 13.

By Stephane Rolland

This report by The Canadian Press was first published Feb. 18, 2025.