Tomlinson acquires Greenbelt, Graydex construction firms

Is bigger better?

R.W. Tomlinson Ltd. describes itself as a "prominent player in the eastern Ontario quarrying, construction, trucking and environmental industries," according to its website.

The Ottawa-based construction company can now add sewer and water main industries to its resumé following the acquisition of two local companies.

Tomlinson recently bought Ottawa Greenbelt Construction Ltd., shortly after purchasing Graydex Ottawa Inc. Both companies specialize in sewer and water main projects.

Tomlinson vice-president Kevin Cinq-Mars said the purchases were part of a "strategic planning process" to build a sewer and watermain capability into the company.

"What's driving it is that there is more of a demand for fully integrated contracts from our customers," he said. "There was a need for us to be able to bundle together a complete vertically-integrated solution for both municipal government and private customers."

Mr. Cinq-Mars added that the two acquired companies will eventually be consolidated into one division.

Tomlinson is a major construction contractor with the City of Ottawa and has also secured 33 jobs, with a total value of more than $101.57 million, in and around Ottawa over the past five years with Ontario's Ministry of Transportation, according to a department spokesperson.

John DeVries, president and general manager of the Ottawa Construction Association, said that Tomlinson's continued expansion is an Ottawa success story.

"The empire is getting bigger," he said of Tomlinson.

With extensive infrastructure work coming up in the city over the next decade, Mr. DeVries said Tomlinson is sitting at a good vantage point.

"They're positioning themselves to be eligible for a lot of that infrastructure spending," he said.

It could also help the company become a stronger contender in the competition to construct Ottawa's $2.1-billion light rail line, Mr. DeVries added, as Tomlinson is part of the consortium headed by French firm Bouygues Travaux Publics S.A. that is vying for the contract.

Other local construction companies such as Taggart Construction Ltd. prevent Tomlinson from having a monopoly on the Ottawa sewer and water main market, but the recent string of acquisitions has brought it closer.

"They didn't become the No. 1 sewer contractor, but they certainly created a presence right away," Mr. DeVries said.

BRANCHING OUT

The consolidation comes as another construction heavyweight, PCL Constructors Canada Inc., expands its capacity to include civil engineering projects.

In 2010, PCL pursued its first civil project in Ontario by bidding on the $1.4-billion Windsor-Essex Parkway construction contract. PCL's consortium came in second place. However, the company continues to pursue civil projects, according to its website.

"PCL's civil teams possess the ingenuity and the experience needed to undertake any civil structure imaginable - from bridges, overpasses, tunnels and interchanges, to water treatment facilities, pipelines, and light-rail transportation projects," the company stated.

Clive Thurston, president of the Ontario General Contractors Association, said that consolidations like these can be seen all over the Canadian construction industry - such as Aecon Group's purchase of mechanical firm Lockerbie & Hole and road building firm South Rock Ltd. in 2010 - as firms attempt to gain an edge when competing for large infrastructure projects.

"In a way, we're almost going back to the way we were 50 years ago when general contractors were doing everything," Mr. Thurston said. "It's general contractors being able to offer more in-house and specialty services and not relying on other trades."

It's not so much the assets that companies are after, but the brain power, he added. With a shortage of professionals in the industry, companies need more manpower to handle big projects.

But with the increasing conglomeration of construction firms, smaller local companies could get "pushed out and bought up," which could lead to the demise of small and mid-sized companies.

"There will be a turnaround," he said. "There always is. We want to make sure there are still small guys out there to do the small work ... Bigger isn't always better."

 

Recent acquisitions by Tomlinson:

• Ottawa Greenbelt Construction (sewer and watermain specialization) (2012)

• Graydex Ottawa Inc. (sewer and watermain

specialization) (2012)

• Lystek International Inc. (organics processing

and biosolids management specialization) (2011)

• Goulbourn-Stittsville Sanitation

(environmental services) (2010)

• Upper Canada Gold (purchased a minority stake of the gold exploration company) (2010)

• Cumberland Ready Mix (supplier of ready-mix

concrete) (2008)

• H-Rose Machining Ltd. (supplier of precision machined components) (2008)

 

Total value of city contracts:

Tomlinson: $59,737,398

Greenbelt: $58,826,151

Graydex: $23,398,879

(Awarded between Oct. 1, 2010 and Sept. 30, 2011)

 

Source: City of Ottawa

 

Top city contracts awarded:

Tomlinson:

$7,771,325.72

Curbside residential solid waste collection in Zone C2 (Ottawa West) for 2011.

Greenbelt:

$6,601,038.45

Reconstruction of Meadowlands Drive from Inverness Avenue to Fisher Avenue.

Graydex:

$5,590,083.84

Phase II of the Cave Creek Sanitary Collector Sewer reconstruction (Carling Avenue to Byron Avenue).

Source: City of Ottawa

 

Tomlinson's provincial contracts*

Total number of contracts: 33

Total value of contracts: $101,574,986

Largest contract: Replacing the Queensway overpass above Carling Avenue (2010)

Largest contract value: $11,680,000

*in and around Ottawa over the past five years (2007-2011)

Source: Ontario Ministry of Transportation