Long-Term Relationship Helps Sustain Environmental Consultancy

Background and challenge

Over the past 15 years, L.E.K. Consulting has gained a deep understanding of the environmental and sustainability consulting industry, having conducted multiple projects for one of the global market leaders and largest ‘pure play’ sustainability consultancies. We have supplied buy-side and sell-side transaction support for the company itself and leading private equity firms on multiple occasions. We also provided support to the company in evaluating strategic options and growth opportunities (organic and inorganic). 

Approach and recommendations

As part of our transaction support work, we performed detailed research into and analysis of the company and the global environmental and sustainability consulting industry. This involved working with the client to synthesize volumes of internal data; undertaking comprehensive modelling to assess the size, nature and segmentation of the market; conducting extensive interview programmes globally with some of the largest users of environmental health and safety (EHS) and sustainability consultants to provide clear insights into the shape of evolving demand, the nature of the competitive landscape and relative positioning of the company; and producing robust reports to facilitate the transaction process.

We have also provided the company with strategic support, including evaluating growth opportunities and adjacent market assessments, conducting management workshops on a multi-regional basis and helping executive management develop their thinking on major relationships, sectors, and service lines and perform gap analysis. We also considered the evolution of global key account management as a growth vector. 

Results

Our work has facilitated multiple successful transaction processes since 2005 and enabled the company to gain a robust understanding of strategic growth opportunities at key points in their evolution, beginning with their acquisition of a stake in a leading environmental strategy and risk consultancy in 2005. In the most recent transaction, the business was valued at around US$3bn, an impressive testament to the value creation delivered by successive management teams and its continued growth potential.