Primoris Expands Utility Business With Acquisition Of PLH Group - Primoris Services (NYSE:PRIM)

Primoris Services Corp PRIM has agreed to acquire PLH Group, Inc. for $470 million in cash.
PLH Group is a utility-focused specialty construction company with a concentration in key fast-growing regions of the U.S.
This transaction doubles the Power Delivery business and increases PRIM's Utilities segment to over 50% of pro forma revenue. The acquisition accelerates PRIM's ongoing portfolio transition towards higher-growth, higher-margin markets and recurring Master Service Agreement (MSA) revenue.
Primoris expects double-digit EPS accretion within 12 months with material cost and revenue synergies. It expects annual cost savings of at least $10 million within 24 months of the deal's closing.
"This acquisition aligns solidly with our strategic focus on higher-growth, higher-margin business segments. It expands our footprint for Power Delivery services at a time when improvement and expansion of our domestic electric grid is driving massive capital investment in this market," stated Primoris CEO Tom McCormick.
For the 12 months ended May 31, 2022, PLH generated total revenue of $733 million and a total adjusted EBITDA of $54 million.
Primoris plans to fund the acquisition through borrowings under its existing credit agreement. Certain members of the existing lender group have committed to providing $425 million of incremental term loans.
As of March 31, 2022, PRIM held $178.6 million of cash and equivalents.
The transaction is expected to close in the third quarter of 2022.
Price Action: PRIM shares are trading higher by 2.50% at $24.20 on the last check Monday.

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