Date Published: April 9, 2014

Each year FMI Capital Advisors, Inc releases  what’s titled. “Mergers & Acquisitions Advisor Trends in the Engineering and Construction Industry.”  Whether or not aPerformance Bonds For Contractors construction company is interested in buying or selling a business, the report provides excellent construction industry insight, summary of 2013 statistics, trend analysis, and outlook into 2014 and beyond.  The following bullets are from some highlights from the publication.

2013 Recap:

  • The Mergers and Acquisitions (M&A) activity was sluggish in 2013, primarily due to the construction rebound lagging behind the rest of the economy.
  • Surety companies continued to see increased loss activity. This was due to contractors being more aggressive with bidding (smaller margins) to try and keep backlogs high. For this reason, FMI expects some high-profile contractors to fail in 2014.
  • Several major metropolitan areas have rebounded from the recession much more quickly than other areas in the U.S.

2014 Trends

  • Multinational Engineering and Construction firms will continue to acuire
  • The Chinese based multinationals will enter and/or expand in the U.S.
  • FMI does not expect improvement in public works, meaning probably more of the same in 2014 in terms of bonded work.
  • Firms looking to acquire will focus on specialized or market segment contractors.  If you are a specialty subcontractor looking to sell, get your business lean and profitable.

At Surety 1, we provide bid, performance, and payment bonds to contractors of all sizes and throughout most parts of the nation.  We can attest that rebounds in the construction industry is largely regionalized, with many differences from county to county.   All in all, however, the 2014 construction activity seems to be similar and on pace with 2013.



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