WSP Global Inc. has announced the divestiture of a subsidiary, Louis Berger Services Inc. (LBS), as part of its strategic realignment efforts. LBS, which was initially acquired in WSP's $400-million takeover of Berger Group Holdings Inc. in 2018, specializes in a range of services, including military operations and maintenance, transportation asset management, and security services. The sale of LBS marks a significant shift for WSP Global, signaling a departure from a business unit that was deemed non-core and inconsistent with the company's primary market focus.

On August 7th, WSP Global confirmed that LBS had been acquired by Versar Inc., an engineering, environmental, and security services company headquartered in Washington, D.C. This divestiture comes as part of WSP's commitment to concentrating on its core markets and expanding into strategic areas that offer substantial growth opportunities. WSP Global is currently ranked as the fourth-largest global design firm according to ENR's Top 150 list, with the majority of its 2022 global design revenue derived from transportation and buildings sectors.

Despite LBS being part of WSP Global for several years, it was never fully integrated into the parent company's operations, as it was identified as non-core from the outset. Instead, WSP's primary goal was to improve the unit's performance and profitability before pursuing a sale. This approach allowed LBS to grow and thrive in its unique niche with a new partner, Versar Inc.

WSP Global has not disclosed specific information regarding the integration of other acquired units from Berger Holdings. However, it was reported that approximately 5,000 employees were added to WSP Global's workforce at the time of the Berger acquisition, with a significant portion based in the United States.With this transaction, Versar Inc. sees an opportunity to expand its service offerings by leveraging LBS's expertise. The two companies view their services as complementary, enabling them to tap into each other's customer bases and capabilities.

Versar Inc. operates in three key segments: environment and sustainability, national security and installation management, and support services. In 2022, the company reported total revenue of $87.15 million, with $22.8 million generated from environmental services, primarily serving federal clients.

Notably, this acquisition will broaden Versar's reach within the U.S. Department of Defense and state agencies, aligning with its focus on offering services that cater to broader mission requirements. The addition of LBS to the Versar portfolio is seen as a strategic move to enhance the company's ability to serve its customers' evolving needs effectively.

Jiri Maly, who served as CEO of LBS since 2016 and was previously the Managing Director of Global Infrastructure for CIBC Capital Markets, has transitioned to Versar Inc. However, his new corporate title was not provided in the announcement.

This divestiture marks a strategic realignment for both WSP Global Inc. and Versar Inc., as they continue to adapt and evolve in their respective market segments. While WSP Global seeks to streamline its focus, Versar Inc. aims to further expand its services and customer base.