Giant engineer could become second biggest architect

Global multidisciplinary consultant Atkins is in talks over buying Pascall + Watson, the architect working on the Heathrow Terminal 5 designs with Richard Rogers.

Michael Haste, a director at Pascall + Watson, said: “We are in talks with a number of people [regarding acquisitions] each year,” but declined to confirm that the firm was in negotiations with Atkins.

A source close to the talks did say negotiations had begun. If they do end in a merger, Atkins would become the second largest practice in the UK behind Building Design Partnership. It is presently fifth.

In 2005 Pascall + Watson employed 146 staff, and had an impressive growth rate. For the year ended April 2005, turnover rose 23% to £11.3m from £9.2m in 2004. Gross profit rose from £2.3m in 2004 to £2.4m in 2005. It is the 20th largest architect in Britain.

The architect is known for its expertise in the transport sector. It is design team leader on the largest terminal to be built in the UK at Heathrow Terminal 5. It has worked on the development of most of the big UK airports including Gatwick, Stansted, Manchester and Birmingham.

The practice also has an extensive rail portfolio including the extension and modernisation of Wembley Park station in preparation for the opening of Wembley stadium in north-west London.

The firm is also providing architectural services at the Eurostar terminal at St Pancras station in north London, and is working on proposals for the reconstruction of the North Bank station at Blackfriars.

Atkins declined to comment on the talks but the source said that acquiring Pascall + Watson would make sense for the company. He said the deal would be a good strategic fit for Atkins as it has expertise in the transport sector.

Atkins is the largest engineering consultancy in the UK and the third largest global design firm in the world. It has more than 15,000 staff in 125 offices in 25 countries.

For the year ended 31 March the company posted a profit before tax of £72m; turnover increased 10% to £1.4bn. Despite facing challenges with the performance of Metronet, the consortium that is upgrading London’s underground system, Atkins reported a 16% increase in profit overall.