Bird Construction (BDT) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition expands presence in British Columbia's high-demand civil infrastructure market, aligning with a national, full-service infrastructure strategy and long-term growth objectives.

• Jacob Bros brings a skilled workforce, modern equipment, robust project backlog, and self-perform capabilities, enhancing scale, diversification, and ability to pursue larger, more complex projects.

• The deal increases exposure to secular trends such as electrification, green infrastructure, and transportation, supporting future growth.

• Strong cultural alignment and leadership continuity, with Jacob Bros' executives joining the combined entity to ensure operational alignment.

• Provides immediate access to new clients and cross-selling opportunities, leveraging significant government and private sector investments in BC.

Financial terms and conditions

• Aggregate consideration of $135 million, including 1.49 million shares (valued at $33.8 million), approximately $97.2 million in cash, and $4 million in assumed equipment debt.

• Funded through existing cash and expanded credit facilities; revolving credit facility increased to $300 million, with a new $125 million term loan, maturing in 2027.

• Implied purchase multiple of 3.7x Jacob Bros' projected 2024 Adjusted EBITDA, exclusive of synergies.

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

• Jacob Bros to be acquired on a cash-free, debt-free basis, except for assumed equipment debt.

Synergies and expected cost savings

• Primary focus on revenue synergies and cross-selling opportunities, with further upside from operational synergies and expanded capabilities.

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

• Anticipated 10% full-year Adjusted EPS accretion, with additional benefits from cross-selling and backlog diversification.

• Margin expansion supported by robust backlog and diversified project mix.

• Minor cost benefits such as improved insurance rates, but no material SG&A synergies targeted.