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Weekly UpdatesLooking to expand into Canada and broaden its global reach, California-based Tetra Tech acquired Wardrop Engineering in the beginning of this year to enhance its engineering expertise and international market potential.
"You have two great companies forming a much stronger North American platform to enable global growth to occur," said Shayne Smith, president of Wardrop Engineering, which has offices in Thunder Bay and Sudbury.
"Both companies had a real desire to accelerate their global expansion," he said. "This extends our global reach ... and (we will) now be able to execute larger projects and programs."
Tetra Tech brings a "wealth of capabilities," Smith said including construction. "And together we can we can work with customers from the early stages of studying a project to actually getting it built."
Wardrop has grown rapidly since being founded in Winnipeg by a five-person team in 1955. Now their 1,200 employees in offices across Canada and worldwide are the newest additions to the family of 19 companies and 10,000 employees under the Tetra Tech umbrella.
"We're doing this deal to expand all our operations," Smith said, including their water, infrastructure and remote power work in Northern Ontario communities, and local mining and pulp industries. Tetra Tech is a world leader in the water business, he added.
"We've been struggling to do a good job of supporting some of the Northern (Ontario) communities, in terms of helping them build and maintain their water infrastructure. Now we have the number one player, with access to their talents."
The deal doubles the size of Wardrop's mining group, Smith added. "We now have the largest front-end mining group in North America, with both engineering and environmental capabilities.
"We're now going to be able to offer more."
Wardrop plans to maintain and possibly expand staff levels in Northern Ontario, Smith said.
"It's the talent there that we desire and value. Our people in Thunder Bay and Sudbury are capable and able to support our projects across Canada and the world," he said.
On the other hand, after more than 30 years of growth in the United States, with revenues reaching $1.2 billion in 2008, Tetra Tech was "strategically looking to expand services globally" said senior vice president Jim Pagenkopf. The first step is North America, and there
is no better place to start than Canada, he said.
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"We have been looking at the Canada area for some time ... we've done our homework and Wardrop came out at the very top of the list."
The acquisition is believed to be the largest US/Canadian engineering consulting industry deal in history And Tetra Tech now has the expertise of Wardrop's 12 Canadian offices. Both companies have similar markets including, natural resources management, infrastructure and energy, Pagenkopf said. "It's a very good fit for us and a very good strategy for expanding our platform into Canada."
Wardrop will remain a wholly owned subsidiary of Tetra Tech continuing to operate as Wardrop and will continue to "provide all the services in the markets they currently (do now)," he said. "The major change for Wardrop is they are now jointly working with Tetra Tech to expand where we can," Pagenkopf said.
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The partnership brings Tetra Tech's infrastructure, water and waste water strengths into Canada and will help Wardrop expand the scope and reach of their mining services globally he said.
"It's going to be an additive affect."
Being Tetra Tech's first Canadian acquisition, Smith explained there is no operations overlap. "They need our (human resources) practices, and we have to be able to run our own networks, our own financial systems," he said.
Bringing Wardrop into the Tetra Tech family has been a smooth transition, Pagenkopf said. "When we acquire companies we try to move as quickly as possible to ensure synergy" he said. "And so far its' going very well." Despite all the economic doom and gloom--both global and local--of recent times both Wardrop and Tetra Tech are optimistic that incoming federal and provincial stimulus packages will provide municipalities with the funds to upgrade local water and power infrastructure.
"That could represent some real opportunities for us," Smith said.
www.wardrop.com
By JAMES NEELEY
Northern Ontario Business
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