Bates enters merger agreement with Clayco subsidiary

Bates & Associates Inc. signed a merger deal with a subsidiary of Chicago-based architecture, engineering, construction and real estate firm Clayco Inc.

The Springfield-based Bates, an architecture firm, is joining forces with Forum Studio to form BatesForum. The company will be evenly split in ownership between Bates’ current partners and Clayco, a 2,000-employee company that recorded $2 billion in 2017 revenue.

Bates President and CEO Steve Warlick will be president of BatesForum, which will have offices in Springfield, St. Louis, Chicago, San Francisco and Bentonville, Arkansas, according to a news release.

Through the deal for undisclosed terms, Warlick also will have a role in Clayco’s health care project work. The specifics of the new management team and organizational details are scheduled to be revealed when the transaction closes within an expected eight weeks.

“We’ve got kind of a unique situation with this merger,” Warlick told Springfield Business Journal. “Typically in mergers, it can have a negative connotation due to the leaning out of departments or whatnot.

“We’ve got more work than we can handle right now. We’re hiring as we speak, and Forum is in the same position.”

The combined firm would have more than 200 employees, and Warlick said BatesForum expects to grow personnel by 25 percent in the first year of operation. He said the new tie to Clayco offers an easy route to foster the upturn.

He said BatesForum would operate its headquarters in St. Louis, from which the Springfield office would garner a greater project capacity and client base through a national footprint with the sister offices in Chicago and San Francisco.

At Forum Studio, longtime Chairman Chris Cedergreen plans to retire and help transition the company’s merger with Bates. Kapil Khanna, Forum’s chief operating officer, will retain that role with BatesForum.

Warlick assumed ownership of Bates in 2011 after founder Alan Bates died of a stroke at age 55.

Bates’ recent projects include Mercy Heart Hospital Springfield, Mercy Branson Multi-Specialty Clinic, the planned expansion of Hotel Vandivort and Big Whiskey’s Republic restaurant.

Warlick said the merger centers on building information modeling technology, a data-rich 3-D modeling processes redefining architecture, engineering and construction.

“Our BIM model is actually alive and breathing in Mercy’s facilities [and] operations,” he said. “It’s got data-rich content in it that they’re using to plug into their integrative-workplace-management-system software.”

Warlick said that type of work is the future of the design industry.

“The new challenge is really how we take this show on the road and expand market share,” he added. “The BatesForum merger allows us all the resources to do that.”

On Springfield Business Journal’s recently released list of the area’s largest architectural firms, Bates ranked third with 10 area registered architects.

According to the release, the combined BatesForum would be the No. 1 company on the St. Louis Business Journal’s largest architecture firm list. Forum Studio ranked seventh, and Bates was 10th on the most recent list in St. Louis, according to the release.