TRANSACTION HIGHLIGHTS:
- High performing Ontario-based civil infrastructure construction business
- Provides a platform to expand Bird's capabilities and relationships in Canada's largest civil infrastructure market
- Creates significant opportunity to leverage Dagmar's experience in delivering complex, specialized projects and drive higher self-perform margins
- Increases diversification in an established, high growth market including the attractive transportation / rail segment
- Expected to be accretive to adjusted earnings and free cash flow in the first full year
MISSISSAUGA, ON, Aug. 31, 2021 /CNW/ - Bird Construction Inc. ("Bird") (TSX: BDT) today announced it has agreed to acquire Dagmar Construction Inc. ("Dagmar"). All transaction agreements have been completed and the transaction will be effective at 12:01 a.m. on September 1, 2021.
Dagmar is an Ontario-based construction company with extensive experience across key civil infrastructure sub-sectors including road, bridge, rail, sewer and water, and commercial-institutional sites.
Over the past 80 years, Dagmar has earned a strong reputation in the construction industry for solid execution, dependable operations, and a safety-oriented culture. Through a continuous focus on innovation, Dagmar has developed a niche for delivery of complex and specialized civil infrastructure projects for both private and public owners across Ontario.
Dagmar's capabilities and service offerings, integrated with Bird's existing civil business, improves Bird's competitive position nationally as well as enables access to the attractive Ontario market. Enhanced access to these markets contributes to increased diversification in a growing end-market with a strong outlook bolstered by government infrastructure commitments. Opportunities to capitalize on a higher portion of self-perform work in larger, complex projects further reinforces the future potential of the integrated business.
"This acquisition provides a platform for Bird, in the largest civil infrastructure market in Canada, to combine our national civil resources with Dagmar's extensive experience in Ontario, and it will be a catalyst for long term growth in the infrastructure sector. It is consistent with our strategy to diversify across both geography and market segments," said Teri McKibbon, President and CEO of Bird. "Through the combination of our two, highly respected businesses, Bird will be positioned to deliver a robust suite of services and leverage strong cross-selling opportunities with major clients across Canada. We are confident in the opportunities this transaction creates for our employees and our clients, and we expect long-term value creation for all of our stakeholders."
"I am very pleased to become an important part of Bird's future, enabled through our well-aligned cultures and company values. In addition to expanding services to our existing clients, this transaction will open the door to larger scale, more diverse work than currently possible," said Denis Bigioni, President of Dagmar. "The opportunities that our collective teams will now be able to access with Bird's national resources and Dagmar's 80 years of history in the Ontario market, will enhance value for all stakeholders."
TERMS OF THE TRANSACTION
The purchase price of the transaction is $32 million, before any adjustments for working capital. Bird intends to finance 80% of the transaction through debt with balance coming from Bird treasury shares issued to the seven principal vendor shareholders. The consideration mix aligns the interests of Dagmar's principals with Bird's shareholders and maintains Bird's conservative leverage and strong liquidity profile.
The Dagmar management team will continue to operate the business with the support of Bird.
https://www.newswire.ca/news-releases/bird-construction-agrees-to-acquire-civil-infrastructure-company-dagmar-construction-851425829.html