US programme manager Hill International has sold its construction claims group, paving the way for a UK acquisition.
An agreement has been reached to sell its claims group to Bridgepoint Development Capital in a £120M cash deal.
The deal will wipe away Hill International’s debt and enable it to make an acquisition in the UK market, the overseas market it is most ”keen on”. It is looking at quantity surveying or project management firms.
“There’s a strong tendency in the UK to hire UK firms. The QS project management firms have a lot of history and strong relationships with clients. We’re going to pick up a major PM or QS firm in the next two years,” said Hill’s chief executive David Richter.
Richter has been seeking a major UK acquisition since February 2012. He told New Civil Engineer that “We have missed out on a couple of firms recently. But in the next couple of years we will have a major QS firm as part of our business. We have our eye on two. It is about picking the right firm, with the right culture at the right time.”
Now he said the time was right, adding that the firm didn’t see Brexit as a threat and was optimistic about the UK market. Currently about 90% of its UK operations are through its construction claims operation, but that it will become much smaller once the sale is finalised.
Richter said pairing the claims operation with Hill International’s project management arm in one company had made it difficult for both operations to win work, as there could be conflicts of interest on work involving claims clients and project management clients.
“The management team felt very strongly that they wanted to be independent. This improves Hill’s position and it an exclusively focus on project management. It’s win win,” said Richter.
In October 2014, Hill bought Scottish engineering firm Cadogans for an undisclosed sum and Richter said the transaction had ”worked out very well”.