A merger of two of Australasia’s leading project management organisations, Xigo and TSA Management, looks set to shake up the sector on both sides of the Tasman.
The two companies are embarking on an ambitious growth programme backed by one of the UK’s top private equity firms, Livingbridge.
The merger — which involves TSA buying Xigo and Xigo shareholders reinvesting in the Group entity — sees both companies retaining their brand and governance structures.
TSA chief executive Andrew Wilson will serve on the Xigo Board, and Xigo director David Wilkie on the TSA Group Board.
Xigo-TSA will now collectively boast more than 250 project managers across five east coast Australia offices and three in New Zealand (Auckland, Wellington and Tauranga).
Commenting on the merger, Mr Wilkie says the transaction creates “a massive network of expertise and talent for us to better serve our existing clients, and to leverage new opportunities in New Zealand, Australia and internationally”.
Mr Wilson says both businesses are very successful in terms of project and financial performance, staff attraction and retention.
“This is about extending our collective capability, our reach, and improving market access for TSA and Xigo,” Mr Wilson says.
“Both businesses are on a growth trajectory,” Mr Wilkie adds, “and this transaction fires up the afterburners.”
Livingbridge is a UK-based, mid-market private equity firm with a presence in the UK, US and Australia. It invested in TSA in 2017, its first Australian investment, and Xigo is its first New Zealand holding.
Mr Wilkie says he and fellow Xigo directors have met Livingbridge’s owners and are impressed with their sophisticated, no-nonsense investment approach and culture, while its global reach complements both companies’ international ambitions.
Mr Wilson says the transaction delivers significant value to both companies.
“This is about building on our collective strengths across the project management sector. They wanted to invest and expand into Australia, and we wanted to invest and expand in New Zealand.
“Both Boards have global ambition, and we’re excited about our extended capability and what we can achieve as a Group.”
Mr Wilkie says the merger represents a significant New Zealand investment in the bigger Australian project management sector.
“Kiwis are still owners and managers of a much larger trans-Tasman business,” he says, while TSA is getting access to the biggest infrastructure building boom in New Zealand’s history.
“Our strategy has been to grow 500% by 2023, organically and through merger or acquisition, and this transaction puts us on track to achieve our goal,” Mr Wilkie says.
“TSA has invested in our business and we’ve invested in the combined business, and we’re bound together to improve both companies’ performance.”