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TRANSACTIONS BOWMAN ACQUIRES RENO-BASED ENGINEERING FIRM CFA, INC. Bowman Consulting Group Ltd., a national engineering services firm delivering infrastructure solutions to customers who own, develop, and maintain the built environment, announced the acquisition of CFA, Inc., headquartered in Reno, Nevada. Founded in 1981, CFA provides a mix of civil engineering, planning, surveying, mapping, and remote sensing to a mix of public and private sector customers. CFA works on projects involving public works and utility infrastructure, traffic and transportation management, data centers, healthcare facilities, educational institutions, hospitality venues, and recreational complexes. The firm’s staff of approximately 30 professionals includes licensed surveyors, professional engineers, a certified planner, certified survey technicians and FAA Part 107 certified UAS pilots. All CFA employees will join Bowman in connection with the acquisition.
“CFA’s team of professionals will be a terrific addition to Bowman,” said Gary Bowman, chairman and CEO of Bowman. “CFA is one of northern Nevada’s leading engineering, surveying and planning firms with clients, capabilities, and a geographic focus which are all extremely complementary to the core business of Bowman. This acquisition strengthens our presence in Nevada and provides a solid base from which to continue expansion throughout the state and beyond. I am pleased to have everyone from the CFA team join Bowman.” “We have a company that is a tremendous source of pride to everyone who has helped make it what it is today,” said Kevin German, P.L.S, president of CFA. “Our commitment to a client first culture and a workplace that employees value has remained unchanged as we have grown over the past several years. As a result, we have achieved an excellent level of employee and client retention. With Bowman, we have found a company with a compatible culture and approach
to employee engagement and customer service. We are confident that this partnership will create valuable client synergies and professional development opportunities to everyone involved.” Financed with a combination of cash, seller notes and equity, the acquisition falls within previously discussed target multiple and operating metric ranges and is expected to be immediately accretive. The company anticipates the acquisition will initially operate at an annualized net service billing run rate of approximately $5 million. More detailed information on M&A activities, pipeline and guidance updates are provided in connection with scheduled quarterly and annual communications. Headquartered in Reston, Virginia, Bowman is a national engineering services firm delivering infrastructure solutions to customers who own, develop, and maintain the built environment.
is to combine with other companies repeatedly and then go public or sell the larger company at some point in the future, the whole process can be a win-win for everyone. Sure there are plenty of issues and details to work out. Who will be in what role post-merger? What will the new company be called? Who will be on the board of the combined company? What valuation method will be used and what will the buyback terms be for internal sales going forward? What will the policies be for the combined company? What redundant overhead will be cut? And much more… Obviously, if this is something you want to pursue, you need to consult specialized legal and tax advisors. Not just any lawyers or CPAs can properly help you, because besides their need to understand mergers, they also need to understand the peculiarities of our industry. You could probably also benefit from specialized management consultants to help you deal with the integration. That said, a merger is certainly one possible way to grow your company and spend little to no cash doing it. Mark Zweig is Zweig Group’s chairman and founder. Contact him at mzweig@zweiggroup.com.
MARK ZWEIG, from page 5
Then the next thing that could happen, if needed, is the combined company immediately embarks on a buyout of the selling company owner(s) who want to retire, using whatever terms are spelled out in their new mutually agreed upon shareholder agreement. This deal works because the selling company owner(s) couldn’t get out before the merger. They didn’t have the financial resources to buy out the principal and they didn’t have the people inside their company wanting to take over who also had sufficient financial resources to pull that off. But the bigger combined company can easily do it. I have seen companies in our business use mergers to grow to 20 times their original size. The owners of smaller companies just kept trading out their ownership in their firms for a smaller percentage of the larger firm. There are many reasons to do it. Strength in numbers, for example. The larger firm valuation gets a premium for a faster growth rate. The smaller firm doesn’t have the capital to do an internal transition. There are more opportunities for their people in a larger company. They can get clients they couldn’t get because they have a larger geographic footprint and more services to offer. And if the goal
ZWEIG GROUP’S MERGERS & ACQUISITIONS ADVISORY SERVICES Whether you’re on the buy- or sell-side of a deal, Zweig Group’s full-scale Mergers & Acquisitions advisory team can help you find and evaluate candidates and then structure the transaction – managing the complicated process from conception to the closing table. Our team of M&A advisors are industry leaders. We approach each project as a cross-functional team consisting of professionals with different expertise working toward a common goal. We blend industry and sector knowledge with experience across the M&A lifecycle to help you capture value for shareholders. Click here to learn more!
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THE ZWEIG LETTER FEBRUARY 26, 2024, ISSUE 1526
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