M&A in the Engineering Consulting sector Paul Collins Chairman, Equiteq 9th November, 2017

Engineering Consulting Engineering Consulting is a core sector focus for Equiteq Equiteq is dedicated to knowledge-led business models in six core sectors Industry Sectors Engineering Consulting 100% focused on knowledge-intensive businesses that leverage expertise and other IP to deliver services People businesses IP / technology intensive Global Fragmented market Management Consulting Life Sciences & Healthcare IT Services Engineering Marketing / Media Engineering Human Resources

Deals in the Engineering space We deliver synergistic buyers by leveraging our market knowledge and industry expertise Property Consulting Sold to Advised on the sale Property Consulting Sold to Advised on the sale Operations Consulting Sold to Advised on the sale Engineering Consulting Sold to Advised on the sale preparation and sale Property Consulting Sold to Advised on the sale Oil & Gas Consulting Sold to Advised on the sale preparation and sale 2016 International Development Consulting Sold to Advised on the sale preparation and sale 2016 Property Consulting Sold to Advised on the sale preparation and sale 2016 Energy Engineering Acquired Advised on target acquisitions

Overall Engineering deal volumes reflect a mature but very active market Engineering Consulting M&A activity, annually (2007 to 2016)* Recent downturn has left smaller (<£4bn) firms vulnerable and larger firms seeking acquisitions to meet their strategic targets Recovery of oil and commodity prices is reawakening M&A activity in oil & gas and other E&C segments Overall steady / slightly declining though bigger deals than last year - Engineering Consulting M&A activity fell against a backdrop of slow economic growth and continued low oil prices. - The number of transactions has fallen by 9% from 2016 to 2015 and median deal values have fallen 4% from 2016 to 2015 . *Source: Equiteq Global Engineering Services M&A Report 2017

Convergence is broadening the player pool beyond E&C M’gement consulting IT services Media & marketing Engineering consulting Human resources consulting Private equity Management consulting *Source: Equiteq Buyers Research Report 2018 (pre-release) Buyers = high demand = medium demand = low interest (Abridged) heatmap of buyer interest for 2018 by segment* = convergence Targets KPMG bought High Point Rendell (international generalist engineering consultancy) in 2015 Arcadis (NL) acquired E2 Managetech in 2017 – a Chicago-based IT services company serving the Environmental Health & Safety (EHS) market Altran acquired IRM in 2017, a UK-based risk management/advisory/cybersecurity firm Tractebel acquired Red in 2016, a UK-based design and business modelling firm, offering services to data centres for commercial buildings

Europe and Asia-Pacific observed substantial growth in M&A volumes Regional Review: # and size of Engineering Consulting M&A deals European M&A up 13% for the period (and Asia-Pacific up 14%) North American sector deal volumes fell dramatically preceding the Presidential election, ending the year 24% down on 2015 Cross-border activity accounted for 28% of all sector deals Source: Equiteq Global Engineering Services M&A Report 2017

Deal size distribution Engineering Consulting M&A activity in 2016: Deals Value Range* Mega deals drove high average deal sizes Strong activity also for small to medium-sized businesses valued between $10m to $500m Average deal sizes increased by 80% to $110m in 2016, supported by large deals from buyers like Stantec. WSP and WS Atkins. Deals under $100m represented 76% of deal volume, but only c.10% by value. We typically observe that smaller transactions are consolidated through small mergers or team grabs, with little cash involved. M&A with a material cash component was strongest over $10m. *Source: Equiteq Global Engineering Services M&A Report 2017

Emerging Technologies Drivers of deal activity in Engineering Achieving Scale Scale enables bidding on larger projects Large firms bidding on smaller projects too Emerging Technologies Firms rely on M&A to stay ahead of the curve Shifts in contracting also driving technology Geographical Expansion Acquiring a local and established firm can lower the risk of entering a new geography Multinational expansion impacts regional players Organised by Offensive and Defensive factors: one of each for each category Contracting: Lump Sum Turn Key (LSTK) and PPP projects are shifting risk to E&C firms, driving requirement for estimation, cost control and procurement technologies Emerging technologies: Big Data, IoT, new building materials, sustainability Geography: Expanding Chinese, Indian and Korean E&C players in particular

Conclusion and wrap-up Overall sector M&A activity steady and poised to grow Antonio Bonet, International development consultancy. Sold. Scale, technology and geographic expansion key themes Convergence expanding the pool for M&A People businesses are complex to grow, value and integrate Sector focus and transaction experience are essential

Get the report at www.equiteq.com The Global Engineering Services M&A Report 2017 Get the report at www.equiteq.com