DeWITT — David Palmerton says he decided to sell his DeWitt–based environmental-consulting firm to help it keep growing.
“We’ve tripled our staff in the past 10 months or so,” says Palmerton, the CEO of the Palmerton Group, LLC, which he founded in 2002. “So we’ve had some tremendous growth. The growth pressure was pretty great, and we looked for help from additional resources.”
Those extra resources came June 1, when Norwood, Mass.–based GZA GeoEnvironmental, Inc. acquired the Palmerton Group. Neither company disclosed the financial terms of the transaction, other than to say it was an all-cash deal.
Palmerton will become a vice president at GZA. His role will be to lead the Palmerton Group, which focuses on the oil and gas industry.
GZA is an environmental and geotechnical consulting firm. It plans to operate the Palmerton Group as a wholly owned subsidiary that will retain its own name and offices.
“They treated us as something very special,” Palmerton says. “And we looked at them and saw a lot of people with expertise and resources that could be applied to much of the work that we have now.”
The Palmerton Group’s growing workload came in its oil and gas practice areas, as well as its other specialized areas, like sediment management, Palmerton says. It has 18 employees, and GZA plans to retain all of them.
Eight of those employees work in the Palmerton Group’s headquarters at 6296 Fly Road in DeWitt. The remaining 10 are split between branch offices in Buffalo and Pittsburgh.
No relocation is currently slated for the group’s Pittsburgh office, but its Buffalo branch will move into 6,000 square feet of space in the Electric Tower on Washington Street, where GZA operates its own 12-person office. Buffalo’s Palmerton Group workers and GZA staff members will work for the two operations independently, although they will be available to pitch in on projects for both firms.
The Palmerton Group will likely be hiring in the near future at its DeWitt headquarters and Pittsburgh office, Palmerton says. GZA would like the group to hire at least 10 people within a year between the two locations.
GZA also wants to expand the Palmerton Group’s 2,000-square-foot headquarters in DeWitt in the next three months. Palmerton would like to work with his group’s current landlord, DeWitt–based Oliva Cos. to find additional space, he says.
The Palmerton Group generated $3.5 million in revenue in 2011, Palmerton says. It projects revenue growth of more than 15 percent this year.
GZA’s 2011 revenue totaled about $100 million, according to its president and CEO, William Beloff. He projected 13 percent revenue growth in 2012 — a rate he says would only be 10 percent without the addition of the Palmerton Group.
The acquisition allows GZA to expand in areas it already serves, according to Beloff. It also gives the company a presence in new areas, like the oil and gas industries.
“We expect them to be very large growth industries,” he says. “It’s something that’s going to last over the next two decades.”
GZA has acquired eight companies over the last six years, he adds. Sometimes it has absorbed the companies into its operations under the GZA banner. Other times it has set them up as subsidiaries operating under their own names.
The Massachusetts firm decides to absorb a company or operate it as a subsidiary based on the market it serves and its reputation, according to Beloff.
“The Palmerton Group really is distinctive in the marketplace and well known,” he says. “It would be foolhardy at this stage to lose the benefit of the name.”
The acquisition gives GZA a total of 26 locations and more than 540 employees in the Northeast, Mid-Atlantic, and Great Lakes regions.
The law firm Hiscock & Barclay, LLP of Syracuse represented the Palmerton Group in this transaction. Palmerton’s accounting firm was Syracuse–based Dermody, Burke & Brown, CPAs, LLC.