Contractor Balfour Beatty has revealed that losing out to Bechtel in the race for the Crossrail project delivery partner contract spurred it to buy US professional services group Parsons Brinckerhoff (PB).
Balfour Beatty, through its Balfour Beatty Management division, bid for the £400M Crossrail role in joint venture with Parsons Brinckerhoff. But it lost out on the job in March (NCE 2 April).
Seven months later Balfour Beatty announced the formal acquisition the consultant for which it paid £380M in October (NCE 29 October).
“What [Crossrail] spurred us to realise was that we can’t always leverage the business as Balfour Beatty,” said chief operating officer Andrew McNaughton.
“Though we were a strong professional services business, we weren’t what professional services people wanted on their CVs. “We had to look at another model. We were in joint venture with PB, so the next step was to buy them.”
McNaughton added that PB will open doors for Balfour Beatty in new markets around the world. Around half of Balfour Beatty’s £10bn turnover is earned overseas, but the majority of that is earned in the United States. New markets in other countries are now the target, said McNaughton.
“Parsons Brinckerhoff is a world class professional services business and it will lead us all into new markets,” he said. “It is the entry point for new markets in the rest of the world. And from there we can finance, manage and maintain infrastructure, but not necessarily build it.”
- Read Andrew McNaughton’s interview in full in NCE’s special feature celebrating the contractor’s centenary.