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Shares of Aecom  (ACM) - Get AECOM Report rose Tuesday, after a report that a rival engineering-services company, WSP Global, asked it about a possible merger.

Knowledgeable sources provided the information to Bloomberg. Representatives for Aecom, Los Angeles, and WSP, Montreal, didn’t immediately respond to requests for comment from

Activist investor Starboard Value last year had pressed for change at Aecom. In October, Aecom agreed to sell its management services unit to a group of private equity firms for $2.4 billion.

Aecom has plenty of orders, thanks to government and infrastructure contracts. But in recent years its profits have flattened out because of inefficiency and construction contract losses, according to Bloomberg Intelligence.

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Meanwhile, WSP has been growing through acquisitions. In November it announced a deal to purchase Elton Consulting Group, an Australian infrastructure and real estate consulting firm. Terms weren't disclosed. 

And in December it closed the purchase of Ecology and Environment Inc., an environmental engineering group in Lancaster, N.Y., for US$67 million.

A tieup with Aecom would give WSP a bigger share of business in the U.S. and could generate cost savings of about $200 million, Deutsche Bank analyst Chad Dillard wrote in a report Tuesday obtained by Bloomberg.

The news service reported that Baird analyst Andrew Witmann said Aecom could fetch in the mid-to high-$50s a share in a deal.

Aecom shares stood at $49.85 at last check, up 5.8%. The stock has climbed 71% over the past year. WSP Global's U.S. shares traded at $71.20, up 0.8%.