Dames & Moore gets set to unveil financial details of two acquisitions.

Dames & Moore will announce next month the terms of two recently announced acquisitions that will increase the L.A.-based environmental engineering firm's size by about a third, Arthur C. Darrow, its incoming chief executive officer, told the Business Journal last week.

Dames & Moore announced last week that Darrow, 51, would succeed George D. Leal, 60, as CEO on Jan. 1. Leal will continue as chairman.

Darrow's promotion from president and chief operating officer is "the culmination of a management succession plan announced in July 1993," according to a company statement. A replacement for Darrow at the position of COO had not been announced as of last week.

Marc H. Sulam, environmental business analyst at New York investment firm Kidder, Peabody & Darrow Co., praised Darrow's promotion.

"He's a focused, fairly energetic, straightforward individual who is going to take a large company in a growing industry and grow it faster than the rest of the industry," Sulam said.

He noted Darrow "spearheaded" Dames & Moore's two recently announced, planned acquisitions.

Letters of intent signed

Dames & Moore announced in August that it had signed letters of intent to acquire San Francisco-based construction firm O'Brien-Kreitzberg & Associates Inc. and New Orleans-based chemical engineering firm Walk, Haydel & Associates Inc. Those deals are expected to be completed next month.

Darrow told the Business Journal last week that both deals would be completed for an undisclosed amount of cash.

"The (Wall Street) analysts have been trying to pry it (the prices) out of us for quite some time," he said. Darrow said he did not want to disclose any information about the deals "until they are absolutely closed."

But he said the two deals represent the "most significant" acquisitions in the firm's history. Together, the deals will increase Dames & Moore's work force of 3,300 by 1,200 and will hike its annual revenue of about $370 million by more than $130 million, Darrow said.

Walk, Haydel & Associates employs about 500 people and sports annual revenues of about $43 million, Darrow said. "We feel they are, if not the finest, one of the finest chemical processing companies in this country," he said.

The other company, O'Brien-Kreitzberg & Associates, employs about 700 and has annual revenues of about $93 million, he said. It specializes in managing large, municipal construction projects and was ranked the largest "pure" construction-management firm in the U.S. by a trade publication.

Other deals in the works

Darrow said he is working on other acquisitions which "are moving toward the letter of intent stage." But, he added, those deals would be "nothing of the size" of the two working acquisitions.

Darrow said the growth curve in the environmental business has flattened out in recent years and the company's business plan is to grow "in a flat environment."

By acquiring companies, "we are going to be able to take bigger and more bites out of that apple, even though the apple is not growing any bigger," he said.

Dames & Moore reported net income of $9.9 million, or 47 cents a share, on revenue of $187.5 million for the fiscal first half ended Sept. 30, 1994. That compares with net income of $12.3 million, or 55 cents a share, on revenue of $182.2 million a year before.

Sulam described Dames & Moore's earnings as "flattish ... affected by sluggish market conditions." He added, however, that Dames & Moore's earnings were "stellar" compared to its industry peers.