Monday,
April 14, 2008
BY JOEL BERG
For The Patriot-News
A midstate engineering
firm known for its work with municipalities is expanding its territory and
services with the purchase of another local company specializing in
environmental cleanup projects.
Herbert Rowland &
Grubic Inc., which counts Susquehanna Twp. and West Hanover Twp. among its
clients, bought Alliance Environmental Services Inc. in a deal that closed
March 31.
The sale will allow
Herbert Rowland to offer service outside Pennsylvania, said Robert C. Grubic,
president of the firm. Based in Swatara Twp., HRG has eight other offices
around the state. Grubic would not disclose the terms of the transaction.
Grubic said that the firms
have worked well together on projects and that it made sense for HRG to be able
to offer the kind of environmental services that Alliance provides.
"They're becoming
more and more of an important component of most of the projects that we
do," he said. "The advantage to us of acquiring Alliance is they
already had a very solid foothold in the market."
Alliance will keep its
office in Susquehanna Twp., and no layoffs are planned at either firm, Grubic
said. Alliance will also keep its name.
Paul Nachlas, who was
president of Alliance, said the sale is a way of building a stronger business.
"Alliance was a good
thing," said Nachlas, now a service group manager. "This deal was an
opportunity to accomplish great."
Among Alliance's local
projects was ensuring that contaminated soil was properly removed from the old
Murata Electronics North America site in Carlisle before the property's
transfer to the Capital Region Economic Development Corp. Alliance also
investigated the soil around Harrisburg Steam Works Ltd. in 1996 for contamination
before the firm's transfer to a national energy provider, according to the
firm's Web site.
Nachlas, like Grubic, said
joining the companies provides a way to offer a fuller range of services.
Steve Gido, a principal at
ZweigWhite, a Chicago-based firm that provides advisory services to the
engineering sector, agreed that clients are increasingly looking for firms that
can handle all their needs.
"It's just too hard
to use three or four different vendors," Gido said.
Engineering firms in Pennsylvania
are also looking to buy counterparts in faster-growing states to the south and
west, Gido said. In 2006, for instance, Pittsburgh-based Michael Baker Corp.
bought Buck Engineering in Cary, N.C.
As the economy sours,
mergers and acquisitions could taper off, Gido said. He expected to see about
180 deals nationwide this year, down from around 210 last year.
"Those firms that do
residential and commercial development are really getting hit hard across the
country," he said, adding that the housing bust is also hurting
municipalities, which are collecting less tax revenue and are thus less able to
afford public projects.
Grubic said the economy
played a role in HRG's purchase of Alliance. He said the diversity of the
firm's work should insulate it from any slowdown.
The deal is the second for
Herbert Rowland. In 2004, the firm purchased Hickory Engineering in western
Pennsylvania, Grubic said.
It is also the second deal
announced this month involving local firms. Last week, Benatec Associates in
Fairview Twp. and its sister company, Harrisburg-based Epsys, said they had
been sold to a Maryland firm, Century Engineering.
ABOUT THE COMPANIES
Herbert Rowland &
Grubic Inc. Headquarters: Swatara Twp. Year founded: 1962 Top executive: Robert
C. Grubic, president Number of employees: 285 Annual revenue: $32 million
Alliance Environmental Services Inc. Headquarters: Susquehanna Twp. Year
founded: 1995 Top executive: Paul Nachlas, president Number of employees: 11
Annual revenue: $2.2 million