PARIS: Paris-headquartered inspection, certification and risk management firm Socotec Group has made a “decisive” move into the UK market after acquiring Environmental Scientifics Group, a testing, inspection and certification (TIC) firm which also has a consultancy service offering.
The acquisition of ESG, and its focus on infrastructure and the built environment represents another endorsement of the UK’s development prospects (Environment Analyst 02-Mar-17) to foreign players following Brexit (EA 16-Mar-17).
Paris-headquartered Socotec has acquired the 1,400-strong Staffordshire-based firm from private equity holders 3i and while the value of the sale has not been publicised, 3i has reported generating around £30 million in proceeds from the sale which represents a 23% uplift on the valuation in December 2016. ESG generated £77 million in annual revenue and made £3.8 million in operating profit during the year ending December 2015 with half of revenue coming from infrastructure projects, a third from the built environment and a fifth from its activities in the energy and waste sectors.
Socotec CEO Hervé Montjotin said: “ESG’s leadership and its extensive range of services, which will enhance our own scope of expertise, will give us another large base in Europe, second in size to the one we have in France. This acquisition, which will double our revenue outside France, is a perfect fit for our international expansion plans.”
ESG CEO Ian Sparks said: “It has been extremely important for us to find an owner that shares our drive for ambitious growth through a client-driven strategy. Socotec, with its global footprint, has an expansive presence, offering inspection and measurement, assistance and consultancy, training and certification services, and works across a number of similar sectors to ESG. This is really good news for both ESG and our clients, as we will be able to provide a wider geographic offering, and also an even broader technical service provision.”
Socotec’s ambition is to increase its group revenue to €800 million by 2020 with ESG boosting the group to a €600 million platform in 2017.
Partner at 3i Pete Wilson said: “During our investment period, ESG has cemented its position as the market leader in the provision of TIC services to its chosen sectors in the UK. I would like to thank Ian Sparks and his management for their significant commitment over the last few years, and I wish them well through the next phase of ESG’s growth with Socotec”.
3i will continue to hold an interest in the environmental services space through its shareholding in SLR Consulting.
