Singapore-based urban development consultancy Surbana Jurong acquired Australian major infrastructure consulting firm SMEC on August 1 in a deal valued at about $400-million.

The aim of the acquisition is to form a global consultancy group with deep combined expertise in the urban and infrastructure sectors. The combined entity will have a global workforce of about 10 000 employees in over 95 offices across 40 countries in Asia, Australia, the Middle East, Africa and the US. It will also be one of the largest urban development and infrastructure consulting firms in Asia.

SMEC CEO and MD Andy Goodwin tells Engineering News that having established offices and personnel in South Africa will allow the combined entity to have a strong presence in the rest of Africa. “We have about 11 offices in South Africa, with just under 1 000 employees and a primary focus on infrastructure development.”

A particular line of interest in undertaking projects in Africa is the development of affordable housing, with Kenya, Tanzania and Ghana being targeted regions for urban development. The combined entity has plans under way to develop about 30 000 affordable houses in Africa.

“The SMEC operation in South Africa is expected to grow substantially as we begin to support government in an area of urban development we have previously not been involved with,” he says.

Goodwin explains that SMEC in South Africa was acquired by SMEC in Australia some years ago. “We recognised the management potential of the South African entity and we left that largely untouched; however, what we were able to do was provide support, technically, in specialist areas where the skill set may not have been available in South Africa.

“Similarly, with the Surbana Jurong acquisition, we will now be able to offer an existing skill set into the existing business which is not currently present.”

Further, in terms of home-grown skills, he says South Africa has built certain specialist areas, such as bridge design. Recently, an Australian client required a design for a large curved arch bridge, which was designed in the Cape Town office of SMEC and built in Australia. “We are definitely looking at developing more of this type of cross-fertilisation, both in and out of South Africa, in terms of populating skill sets.”

Meanwhile, Surbana Jurong chairperson Liew Mun Leong explains that, to grow and support their economies, much of Asia and many other emerging countries have either had to or will have to catch up in terms of their deficit in urbanisation and infrastructure development.

He adds that, according to a report by professional services firm PwC, infrastructure spending is expected to grow from $4-trillion a year in 2012 to more than $9-trillion a year in 2025, of which 60% will be in the Asia-Pacific market.

In addition to financing and funding, Mun Leong says wide and deep technical expertise in urbanisation and infrastructure development is required. “Singapore and Australia have successfully done many major showcase national development projects through Surbana Jurong and SMEC. Besides their complementary strengths, both companies have very similar corporate structures and core values. It will be timely and opportunistic for the synergetic merger of these two competent organisations to share their expertise and capture the large market opportunities.”

Surbana Jurong group CEO Wong Heang Fine says the merger represents a “rich and proud heritage of major iconic projects recognised around the world”, adding that SMEC’s experience and strength in major infrastructure projects in the fields of urban transport, the energy and water sectors, mass rapid transit and light rail transit systems, bridges and highways, coupled with Surbana Jurong’s track record and expertise in urban planning, township and industrial development, will enable the merged company to offer unique complete value chain services in urban and infrastructure solutions to its clients on a global scale.

“As a company with a worldwide presence, global experience and expertise, and local knowledge, we will be able to assist our clients to solve complex challenges in different markets. We will also be able to use our wide network of clients to find synergistic development and business opportunities across various sectors and geographies. Together, the company will be in a unique position to capture opportunities in the global market . . . on a path to accelerated growth,” he says.

Goodwin notes the merger will enable SMEC to further accelerate and support SMEC’s growth ambitions. “This partnership is a reflection of the strategic value of our business and its potential to further deliver solutions internationally. “It also signifies recognition of the professional skills at SMEC.”