This press release is provided by GlobeNewswire and is published as received.
TORONTO, June 25, 2026 (GLOBE NEWSWIRE) -- Aecon Group Inc. (TSX: ARE) (“Aecon” or the “Company”) announced today that it has entered into an agreement to purchase the convertible preferred equity investment (the “Preferred Shares”) held by funds managed by the Power Opportunities strategy of Oaktree Capital Management, L.P. (“Oaktree”) in Aecon’s utility infrastructure subsidiary, Aecon Utilities Group Inc. (“Aecon Utilities”; together, the “Transaction”), with closing expected to occur in the fourth quarter of 2026.
HIGHLIGHTS
The $320 million purchase price for the Preferred Shares is based on Oaktree’s as-converted 27.5% ownership interest in Aecon Utilities and represents an equity value of $1.2 billion and an enterprise value of $1.5 billion for Aecon Utilities. The Transaction implies a 13.0x enterprise value multiple to Aecon Utilities’ trailing twelve-month (“TTM”) acquisition-related pro forma Adjusted EBITDA(1) to March 31, 2026.
Aecon Utilities is a leading North American provider of utility infrastructure solutions operating across three core end-markets: electrical, communications, and pipeline distribution. Since the completion of Oaktree’s Preferred Shares investment in Q4 2023, Aecon Utilities has developed into a larger and more diversified utility services platform with greater exposure to electrical end-markets (~49% of TTM acquisition-related pro forma revenue to March 31, 2026) and a greater presence in the U.S. (~26% of TTM acquisition-related pro forma revenue to March 31, 2026), which are both largely underpinned by long-term repeatable work programs through Master Service Agreements.
The Transaction is expected to provide immediate and long-term benefits to Aecon, including:
“This transaction accelerates Aecon’s overall growth in target markets, augments our self-perform offering with cross-selling opportunities, and enhances our ability to expand into growing regions with attractive project pipelines under a One Aecon approach,” said Jean-Louis Servranckx, President & Chief Executive Officer, Aecon.
“We were pleased to have partnered with an experienced and value-added investor in Oaktree to continue Aecon Utilities’ growth in Canada and the U.S. and each have benefited greatly from the partnership,” said Eric MacDonald, Executive Vice President, Aecon Utilities.
Jimmy Lee, Managing Director and Assistant Portfolio Manager in Oaktree’s Power Opportunities Group, said “Aecon Utilities’ strong competitive position, long-term customer relationships and exposure to numerous market tailwinds provided an exceptional foundation for growth. We were proud to bring our resources and relationships to support Aecon Utilities’ talented leadership team and employees as they executed their strategic plan over the course of our investment.”
“Aecon Utilities is widely known as a leading provider of mission critical recurring utility infrastructure services with an unwavering commitment to workforce safety and exceptional quality. We were delighted to contribute our knowledge and expertise in its organic and acquisitive growth across Canada and in the U.S.,” said Andrew Moir, Managing Director in Oaktree’s Power Opportunities Group.
Closing of the Transaction is expected to take place in the fourth quarter of 2026 and to be financed through Aecon’s existing cash resources and available credit facility capacity. The carrying value of the Preferred Shares of Aecon Utilities at June 30, 2026 is expected to be equal to the purchase price, with the unrealized loss on derivative financial instrument reflected in Finance Costs.
Additional information regarding the terms of the Transaction will be included in a material change report available through Aecon’s profile via SEDAR+ at (www.sedarplus.ca). This press release is only a summary of certain principal terms of the Transaction and is qualified in its entirety by reference to the more detailed information contained in the material change report.
Advisors
CIBC Capital Markets is serving as financial advisor to Aecon and Davies Ward Phillips & Vineberg LLP is serving as legal counsel. CIBC Capital Markets provided an opinion to the Board of Directors that, as of the date thereof and subject to the assumptions, limitations and qualifications set forth therein, the consideration to be paid by the Company pursuant to the share purchase agreement to be entered into to effect the Transaction was fair, from a financial point of view, to the Company.
About Aecon
Aecon Group Inc. (TSX: ARE) is a North American construction and infrastructure development company with global experience. Aecon delivers integrated solutions to private and public-sector clients through its Construction segment in the Civil, Urban Transportation, Nuclear, Utility and Industrial sectors, and provides project development, financing, investment, management, and operations and maintenance services through its Concessions segment. Join our online community on X, LinkedIn, Facebook, and Instagram @AeconGroupInc.
NON-GAAP FINANCIAL MEASURES
This press release presents certain non-GAAP financial measures, as well as non-GAAP ratios to assist readers in understanding the Company’s performance (GAAP refers to Generally Accepted Accounting Principles under IFRS). These measures do not have any standardized meaning and therefore are unlikely to be comparable to similar measures presented by other issuers and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.
Throughout this press release, the following terms are used, which do not have a standardized meaning under GAAP.
Non-GAAP Financial Measures
A non-GAAP financial measure: (a) depicts the historical or expected future financial performance, financial position or cash flow of the Company; (b) with respect to its composition, excludes an amount that is included in, or includes an amount that is excluded from, the composition of the most comparable financial measure presented in the primary consolidated financial statements; (c) is not presented in the primary financial statements of the Company; and (d) is not a ratio.
Non-GAAP financial measures presented and discussed in this press release are as follows:
Non-GAAP Ratios
A non-GAAP ratio is a financial measure presented in the form of a ratio, fraction, percentage or similar representation and that has a non-GAAP financial measure as one of its components and is not disclosed in the financial statements of the Company.
A non-GAAP ratio presented and discussed in this press release is as follows:
Management uses the above non-GAAP financial measure to analyze and evaluate operating performance. Aecon also believes the above financial measure is commonly used by the investment community for valuation purposes, is a useful complementary measure of profitability, and provides a metric useful in the construction industry. The most directly comparable measures calculated in accordance with GAAP are operating profit and profit (loss) attributable to shareholders.
Acquisition-Related Pro Forma Financial Information
This press release also presents certain acquisition-related pro forma financial information to assist readers in understanding the Transaction. These measures do not have any standardized meaning and therefore are unlikely to be comparable to similar measures presented by other issuers and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.
On January 6, 2026, Aecon Utilities completed the acquisition of K.P.C. Power Electrical Ltd. and K.P.C. Energy Metering Solutions Ltd. (collectively “KPC”), headquartered in Ontario, and on March 9, 2026, Aecon Utilities completed the acquisition of Duna Services, LLC (“Duna”), headquartered in Indiana, and its subsidiaries Arc American, LLC and C.A. Advanced, LLC, and a 49% interest in KNX Utility Services, LLC (“KNX”) from Ryker Holdings Inc. These acquisitions were accounted for as a business combination in accordance with IFRS 3 in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS Accounting Standards”).
To assist investors in evaluating the impact of these acquisitions on the Company’s operating performance, the Company has presented acquisition-related pro forma revenue and Adjusted EBITDA for the twelve months ended March 31, 2026, as if the acquisitions of KPC and Duna had both occurred on April 1, 2025, and enterprise value as a multiple of Aecon Utilities’ TTM acquisition-related pro forma Adjusted EBITDA(2) to March 31, 2026. The pro forma financial information was prepared by combining the historical results of Aecon Utilities with the historical results of KPC and Duna.
Enterprise value as a multiple of pro forma Adjusted EBITDA represents the enterprise value of Aecon Utilities using the implied equity value of the Transaction after adjusting for debt in Aecon Utilities as a percentage of TTM acquisition-related pro forma Adjusted EBITDA to March 31, 2026.
The following tables summarize Aecon Utilities’ reported and acquisition-related pro forma financial information for the TTM period ended March 31, 2026 and enterprise value as a multiple of pro forma Adjusted EBITDA at March 31, 2026:
Notes:
(1) Adjusted EBITDA is a non-GAAP financial measure. (2) Acquisition‑related pro forma adjusted EBITDA is a non-GAAP measure.
(3) Enterprise value as a multiple of pro forma Adjusted EBITDA is a non-GAAP ratio.
(4) Acquisition‑related pro forma revenue is a non-GAAP measure.
The pro forma financial information presented above is non-GAAP financial information and is based on certain assumptions and estimates that management believes are reasonable in the circumstances. The pro forma results are provided for illustrative purposes only and do not purport to represent what the Company’s actual results of operations would have been had the acquisition occurred on April 1, 2025, nor are they necessarily indicative of future results.
Acquisition-related pro forma Adjusted EBITDA is derived from Adjusted EBITDA, which is a non-GAAP financial measure (as defined above). Management believes that the presentation of pro forma revenue and pro forma Adjusted EBITDA provides useful information to investors regarding the scale, earnings profile, and potential financial impact of the acquisition as if it had been completed at the beginning of the period and assists in period-over-period comparability.
Statement on Forward-Looking Information
The information in this press release includes certain forward-looking statements which may constitute forward-looking information under applicable securities laws. These forward-looking statements are based on currently available competitive, financial, and economic data and operating plans but are subject to known and unknown risks, assumptions and uncertainties. Forward-looking statements may include, without limitation, statements regarding the operations, business, financial condition, expected financial results, the payment of dividends, the repurchase of shares, performance, prospects, ongoing objectives, strategies and outlook for Aecon, including statements regarding: the closing of the Transaction and the expected timing thereof; the funding of the purchase price; the anticipated benefits of the Transaction described herein; expectations regarding Aecon’s adjusted earnings per share; the uncertainties related to the unpredictability of global economic conditions; expectations regarding operational and financial performance; expectations regarding the pipeline of opportunities tied to power generation, critical resource development, mass transit infrastructure, water, and defence available to Aecon; and expectations regarding growth, and the acceleration thereof, of Aecon in Canada and the U.S. Forward-looking statements may in some cases be identified by words such as “will,” “plans,” “schedule,” “forecast,” “outlook,” “completing,” “mitigating,” “potential,” “possible,” “maintain,” “seek,” “cost savings,” “synergies,” “strategy,” “goal,” “indicative,” “may,” “could,” “might,” “can,” “believes,” “expects,” “anticipates,” “aims,” “assumes,” “upon,” “commences,” “estimates,” “projects,” “intends,” “prospects,” “targets,” “occur,” “continue,” “should” or the negative of these terms, or similar expressions. In addition to events beyond Aecon’s control, there are factors which could cause actual or future results, performance, or achievements to differ materially from those expressed or inferred herein including, but not limited to: the risk of not being able to close the Transaction, the risk of not being able to realize the expected benefits and opportunities resulting from the Transaction; the risk of not being able to meet contractual schedules and other performance requirements on large, fixed priced contracts; the risks associated with a third party’s failure to perform; the risk of not being able to execute its strategy of building strong partnerships and alliances; the risk of not being able to identify and capitalize on strategic operational investments; the risks associated with the seasonal nature of its business; the risks associated with changing levels of demand for Aecon’s services; the risks associated with being able to participate in large projects; risks associated with future pandemics, epidemics and other health crises and Aecon’s ability to respond to and implement measures to mitigate the impact of such pandemics or epidemics; the risk of the anticipated benefits and synergies from strategic acquisition transactions not being fully realized or taking longer than expected to realize; the risk of being unable to retain key personnel; the risk of being unable to maintain relationships with customers, suppliers or other business partners; and various other risk factors described in Aecon’s filings with the securities regulatory authorities, which are available under Aecon’s profile on SEDAR+ (www.sedarplus.ca), including the risk factors described in Section 13 - “Risk Factors” in the 2026 annual Management’s Discussion and Analysis (“MD&A”) for the fiscal year ended March 31, 2026 and in Aecon’s MD&A for the fiscal quarter ended March 31, 2026, and in other filings made by Aecon with the securities regulatory authorities in Canada.
Forward-looking statements are presented for the purpose of helping investors and others in understanding certain key elements of Aecon’s current objectives, strategic priorities, expectations and plans, and to gather a better understanding of Aecon’s business and operating environment. These forward-looking statements are based on a variety of factors and assumptions including, but not limited to that: none of the risks identified above materialize, there are no unforeseen changes to economic and market conditions and no significant events occur outside the ordinary course of business and assumptions regarding the outcome of the outstanding claims in respect of the fixed price legacy projects being performed by joint ventures in which Aecon is a participant. These assumptions are based on information currently available to Aecon, including information obtained from third-party sources. While the Company believes that such third-party sources are reliable sources of information, the Company has not independently verified the information. The Company has not ascertained the validity or accuracy of the underlying economic assumptions contained in such information from third-party sources and hereby disclaims any responsibility or liability whatsoever in respect of any information obtained from third-party sources.
Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and Aecon undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
For further information:
Adam Borgatti
SVP, Corporate Development and Investor Relations
416-297-2600
ir@aecon.com
Nicole Court
Vice President, Corporate Affairs and Communications
416-297-2600
corpaffairs@aecon.com
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