Cardno finds Texan star with $77m acquisition

Cardno finds Texan star with $77m acquisition

Infrastructure and environmental services group Cardno (ASX: CDD) has come out of a trading halt to announce an agreement to acquire Texan engineering services firm Raba Kistner Inc for US$55 million ($77 million).

With 470 staff, Raba Kistner specialises in construction materials testing, geotechnical engineering consulting, project management and independent quality assurance and inspection.

The Texan group mostly caters to transport infrastructure projects, government and commercial clients, and will become part of Cardno's construction sciences division

The figure includes an upfront purchase price of US$42.5 million ($59.3 million) with $12.5 million ($17.4 million) of additional performance linked payments due over the next three years, with the acquisition effective as of 30 November 2018.

Cardno expects the purchase will significantly increase its construction sciences' geographic footprint, with managing director Ian Ball claiming it is in line with Cardno's growth plan through conservatively funded 'on strategy' accretive acquisitions.

"Construction Sciences is the leading Construction Materials Testing business in Australia, and with the acquisition of Raba Kistner, we have acquired a similar high-performing business headquartered in Texas," says Ball.

"We look forward to working with the Raba Kistner management team to continue to grow the business in Texas and beyond in the coming years."

With the acquisition, Cardno director Mr Neville Buch will remain on the Cardno board and will join the board of Raba Kistner.

Raba Kistner earned a normalised US$58.5 million ($81.6 million) of net revenue and US$7.1 million ($9.9 million) of EBITDA in the 12 months to September 2018.

The acquisition is expected to contribute approximately US$3.8 million ($5.3 million) in EBITDA to Cardno's FY19 results.

Never miss a news update, subscribe here. Follow us on Facebook, LinkedIn, Instagram and Twitter.

Business News Australia

Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support

Does your pay structure answer today's challenges?
Partner Content
If you are not reassessing how your organisation remunerates and rewards employees as a...
Aon
Advertisement

Related Stories

Shine launches class action against QSuper

Shine launches class action against QSuper

Members of QSuper have filed a class action against the super fund ...

Nic Blair's digital healthcare startup Midnight Health scores $4m investment from nib

Nic Blair's digital healthcare startup Midnight Health scores $4m investment from nib

Health insurer nib (ASX: NHF) has put its weight behind healthcare ...

Reprieve for EML Payments as Irish regulators allow new customers and programs

Reprieve for EML Payments as Irish regulators allow new customers and programs

The dreaded 'Bank of Ireland Update' has become an ominous ...

GURNER, Qualitas raise $1.2 billion for rent-to-build platform

GURNER, Qualitas raise $1.2 billion for rent-to-build platform

Developer GURNER and alternative real estate investment manager Qua...