Companies in the engineering, industrial and infrastructure services (EI&I) arena are finding success, bolstered by "persistent tailwinds such as aging infrastructure and the ongoing deployment of government funding," according to a new market research report from Houlihan Lokey, a global investment bank with expertise in mergers and acquisitions, capital markets, financial restructuring and financial and valuation advisory. Merger and acquisition volume within the sector is high. Global dynamics create a favorable landscape for companies in the sector, offering substantial growth opportunities, especially through strategic acquisitions.
These dynamics include the urgent need to retrofit or replace outdated systems and the surge in new construction projects supported by infrastructure initiatives in the U.S. and Europe.
According to the report by Houlihan Lokey, Inc. , EI&I deal volume exceeds pre-pandemic levels: "In the first half of 2024, transaction volume showed outsized growth relative to the same period across previous years." Mergers and acquisitions within the sector have experienced a surge in investments, driven by a growing need for specialized labor and the desire to compete in high-value, resilient end markets, such as transportation, water, power, renewables, industrials, healthcare and education.
Another key takeaway in the Houlihan Lokey "Engineering, Industrial and Infrastructure Services Market Update: Q2 2024" is that government efforts persist in funding infrastructure, while strategic acquirers seek to improve their service offerings and address the ongoing demand for critical infrastructure enhancement.