Bird Construction (BDT) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition expands presence in British Columbia, the largest infrastructure market in Western Canada, and aligns with a long-term strategy to build a national full-service infrastructure vertical.

• Jacob Bros brings a skilled workforce, modern equipment, robust project backlog, and self-performed civil infrastructure capabilities, enhancing scale and diversification.

• The deal increases exposure to secular trends such as electrification, green infrastructure, energy transition, and transportation needs, supporting long-term growth.

• Strong cultural alignment and leadership retention, with Jacob Bros' executives joining to lead Western infrastructure operations.

• Provides immediate access to a robust pipeline of infrastructure projects and new clients, leveraging significant government and private sector investments in BC.

Financial terms and conditions

• Aggregate consideration of $135 million, including 1.49 million common shares (valued at $33.8 million), approximately $97 million in cash, and $4 million in assumed equipment debt.

• Implied purchase multiple of 3.7x projected 2024 adjusted EBITDA, exclusive of future synergies.

• Jacob Bros expected to generate ~$300 million revenue and $37 million Adjusted EBITDA in 2024, with a backlog of ~$350 million.

• Funded through existing cash, expanded credit facilities, and a cash-free, debt-free acquisition structure (except for equipment debt).

• Bird amended its credit facility, adding a $125 million term loan and expanding its revolving credit facility to $300 million.

Synergies and expected cost savings

• Primary focus on revenue synergies and cross-selling opportunities across both companies' client bases and sectors.

• Anticipated 10% EPS accretion on a full-year basis, with further upside from combined project pursuits and operational synergies.

• Expected to enhance Adjusted EBITDA margins by 60 basis points annually, enabled by improved project mix and self-perform expertise.

• Limited emphasis on cost synergies; some minor benefits expected from scale, such as insurance volume discounts.

• Combined company will leverage Jacob Bros' robust backlog and diversified project mix for profitable growth.