Bird to Acquire B.C.-Based Civil Infrastructure Contractor for $135 Million
On June 10, 2024, Bird Construction Inc. announced that it has entered into a share purchase agreement under which Bird will acquire Jacob Bros Construction (Jacob Bros) for estimated aggregate consideration of $135 million.
Pending relevant regulatory approvals and the satisfaction of other customary closing conditions, the transaction is expected to be completed early in the third quarter of 2024.
Jacob Bros is a privately-owned civil infrastructure construction business headquartered in Surrey, BC. Its two shareholders, Scott Jacob, CEO and Todd Jacob, COO, will join Bird to lead the combination of Bird’s Western Infrastructure business and their existing business.
Jacob Bros operates with a strong, people-first culture and has been recognized as a top employer in both BC and Canada. The business also specializes in civil infrastructure construction across various projects, including airports, seaports, rail, bridges and structures, earthworks, energy projects, and utilities. It also delivers expertise in specialized projects that require purpose-built, custom solutions.
“We are really pleased that Scott and Todd Jacob will be bringing their comprehensive experience to the Bird team. The acquisition of Jacob Bros, a full-service infrastructure provider in BC, represents a significant milestone in the evolution of our business, establishing a broader and more diversified operation. The company brings a strong market reputation, highly skilled team, and proven track record for delivering complex projects to sophisticated, long-term clients,” saidTeri McKibbon, president and CEO of Bird.
“The combined company will have a greater platform from which it will be able to access larger-scale projects and expand career opportunities for employees. The acquisition will enable Bird to advance our strategic focus on complex work in high-demand, higher-margin self-perform sectors, which we expect will contribute to continued margin enhancement.”
The partnership will increase revenue generated by infrastructure projects, which advances Bird’s strategy to balance its portfolio across its three core verticals: industrial, buildings, and infrastructure.
Following the close of the transaction, Bird expects its debt ratios to remain consistent with the company’s practice of maintaining low leverage. Other than the assumption of equipment debt, Jacob Bros will be acquired on a cash-free, debt-free basis.
Bird also amended its Syndicated Credit Facility, extending the maturity date to December 15, 2027. The amendments included the replacement of existing term loan facilities with a new $125 million term loan facility, the expansion of the company’s revolving credit facility to $300 million, and an increase of the non-committed accordion feature to $100 million.
The transaction is expected to be accretive to Bird’s Adjusted Earnings Per Share by approximately 10 per cent on a full-year basis. Accretion would be further enhanced by future synergies including cross-selling opportunities.
For the full year of 2024, Jacob Bros is expected to generate approximately $300 million of revenue and $37 million of adjusted EBITDA.