Service Stream (SSM) M&A announcement summary

Deal rationale and strategic fit

• Acquisition of 100% of Programmed expands facility and asset management, industrial maintenance, staffing and infrastructure services across Australia and New Zealand.

• Combined addressable markets reach AUD 179bn, with exposure across government, utilities, energy, resources, mining, transport and manufacturing.

• Tier 1 and government clients, complementary capabilities and limited end-market overlap broaden revenue exposure and support earnings resilience.

Financial terms and conditions

• Purchase price is AUD 975m; implied enterprise value is AUD 1,092m, including AUD 117m of lease liabilities.

• Estimated cash payable at completion is AUD 885m–AUD 910m before customary adjustments; AUD 65m of debt-like items and up to AUD 25m tied to the FY ending 31 March 2027 EBITDA hurdle affect consideration.

• Funding comprises a AUD 475m fully underwritten equity raise, AUD 490m debt drawdown and AUD 50m existing cash; debt facilities rise from AUD 395m to AUD 895m.

• Equity raise includes a AUD 256m 1-for-4.9 entitlement offer and AUD 219m placement at AUD 2.03 per share; ~234m shares, ~37.8% of existing shares, are expected to be issued.

• Pro forma net debt/FY26 EBITDA is expected at 2.2x at completion, moving toward ~2.0x on FY27 numbers and ~1.5x within 24 months.

Synergies and expected cost savings

• Initial annual cost synergies are AUD 30m: ~AUD 15m from resourcing, ~AUD 10m procurement and ~AUD 5m property, IT and other savings.

• ~50% of run-rate synergies are targeted within 18 months of completion and all within 36 months; further cost and earnings opportunities may follow.

• FY27 pro forma EPS-A accretion is forecast above 20% including synergies and mid-single digits before synergies; one-off integration costs are estimated at ~AUD 35m.

• Additional earnings opportunities include cross-selling, improved resource utilisation and contract-level performance reviews; no separate margin-improvement target was set.