Dive Brief:
- Zachry Construction, a San Antonio-based infrastructure builder, has reached an agreement to acquire Plano, Texas-based Crescent Constructors, a move that will help the contractor hone in on in-demand water projects, according to a Tuesday news release.
- As part of the deal, 100 employees will continue to operate in Plano under the Crescent Constructors name, per the release. Zachry declined to disclose the financial terms of the deal.
- Crescent Constructors focuses exclusively on municipal and industrial water projects, an area Zachry Construction believes will buttress its growing portfolio of infrastructure services.
Dive Insight:
Earlier this year, the American Society of Civil Engineers called out new threats to water infrastructure, particularly in light of “forever chemicals” such as perfluoroalkyl and polyfluoroalkyl substances, or PFAS. At the same time, large infrastructure builders have been bullish on the water segment, citing growing momentum and the necessity of repairs as driving forces for the sector.
Zachry Construction, for its part, shares the sentiment. Travis Mross, executive vice president of Zachry, told Construction Dive via email that the company is focused on delivering large-scale, complex infrastructure projects across the industrial and civil sectors. Water and infrastructure projects play a key part in that ambition, he added.
“Looking forward, transportation and water infrastructure represent significant opportunities for Zachry Construction and Crescent Constructors to expand our impact, address critical societal needs, and deliver long-term value for our clients,” Mross said.
M&A activity has spiked since the COVID-19 pandemic began, according to a report from consulting firm McKinsey. The company found that globally the average number of deals per year increased by around 60%, from approximately 1,100 transactions between 2014 and 2019 to about 1,800 transactions between 2020 and 2024, per the report.
However, Zachry’s move to acquire Crescent comes amid a strained economic environment, which has had downwind effects on M&A activity in construction. Alexandre L’Heureux, the CEO of Montreal-based builder WSP, said during an earnings call in May that instability and a lack of future visibility were the worst things that could happen for M&A.
To be sure, that hasn’t stopped firms from pulling the trigger. Earlier this year, for example, Canadian builder Graham Construction merged with California-based XL Industries to expand its U.S. presence.
Going forward, Crescent Constructors is keeping an eye to the future.
“With the strength of Zachry's national platform behind us, we are excited to grow our capabilities and continue delivering essential infrastructure,” said Mike Daigre, founder of Crescent Constructors, in the news release.
