MONTREAL - Shares in engineering services firm WSP Group hit a record high Tuesday after industry analysts raised the company's target prices by as much as 15.7 per cent on a bullish outlook of its prospects for growth.

At least six analysts increased their price targets to between $36 and $42 after WSP closed a $293-million equity offering to fund the acquisition of Alberta engineering and geomatics firm Focus Group Holding.

The Quebec-based company's (TSX:WSP) shares peaked at $37.12 in mid-day trading before closing at $36.82, up $1.09 or 3.05 per cent, on the Toronto Stock Exchange.

Ben Vendittelli of Laurentian Bank Securities says the $366-million acquisition of Focus will result in significant sales opportunities as WSP leverages Focus' energy expertise with its other customers.

"We believe the acquisition of Focus provides the missing piece to WSP's global connectivity strategy allowing it to have a broad presence geographically and in all key verticals," he wrote in a report.

With its $284 million of annual revenues and high profit margins, observers say the addition of Focus and its 1,700 employees strengthens WSP's footprint in Canada and gives it a strong presence in Western Canada's growing energy sector.

The deal, which is expected to close about April 17, would also put WSP more than halfway towards its goal of adding $500 million of revenues from acquisitions by the end of 2015.

Paul Lechem of CIBC World Markets called the Focus acquisition "a significant step" towards WSP's target of generating $2.3 billion of annual net revenues and employing 20,000 people. He said the equity issue, including an $86-million private placement with the Caisse de depot and Canada Pension Plan Investment Board, was oversized to fund future acquisitions.

Vendittelli said he expects WSP will be able to capitalize on long-term opportunities and benefit from an eventual recovery in the U.K. and key markets in northern Europe.

Frederic Bastien of Raymond James raised his target price 27 per cent to $42 saying that the Focus deal makes WSP a better investment.

In addition to filling "a big hole" in its service offering, the analyst said Focus helps to "rebalance and strengthen the firm's footprint in Canada, which has been heavily weighted toward the east."

The deal will increase the number of employees by more than 10 per cent and bolster WSP's Canadian presence to 6,100.

Quebec would account for just 10 per cent of overall revenues. The rest of Canada would lead with 31 per cent, following by 24 per cent in Northern Europe, 14 per cent in UK, 12 per cent rest of the world, and nine per cent in Canada.

Sara O'Brien of RBC Capital Markets, who comes in at the low end of the price targets, says WSP's shares are trading at a premium compared to its peers, despite the organic cross-selling sales opportunities that will be derived from Focus.

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News from © The Canadian Press, 2014