Mcgrath Rentcorp · NASDAQ:MGRC
Mcgrath Rentcorp — Merger or Acquisition (January 2024)
19 slides from Mcgrath Rentcorp's merger presentation, Jan 29, 2024
Slide 1: WillScot Mobile Mini to Acquire McGrath
WillScot Mobile Mini to Acquire McGrath January 29, 2024 Filed by WillScot Mobile Mini Holdings Corp. Pursuant to Rule 425 under the Securities Act of 1933 and deemed filed pursuant to Rule 14a-12 under the Securities Exchange Act of 1934 Subject Company: McGrath RentCorp Commission File No. 000-132
Slide 2: Safe Harbor Forward Looking Statements
2 Safe Harbor Forward Looking Statements This presentation contains forward-looking statements (including the guidance/outlook contained herein) within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended. The wor
Slide 3: Safe Harbor Additional Information and Where to Find It
3 Safe Harbor Additional Information and Where to Find It In connection with the proposed transaction, WillScot Mobile Mini will file with the SEC a registration statement on Form S-4 that will include a proxy statement of McGrath and that will also constitute a prospectus of WillScot Mobile Mini. I
Slide 4: Today's presenters
4 Today’s presenters Brad Soultz Chief Executive Officer WillScot Mobile Mini Tim Boswell President & Chief Financial Officer WillScot Mobile Mini Joseph Hanna President & Chief Executive Officer McGrath
Slide 5: A highly synergistic combination
5 Storage 23% Modular 72% TRS 5%Storage 12% Modular 68% TRS 20%Storage 26% Modular 74% ~$2.4B ’23E Revenue1 A highly synergistic combination ✓ Extends position in North America in turnkey space solutions with enhanced geographic coverage and a more diversified platform ✓ Strengthens service offering
Slide 6: Transaction summary
6 Transaction summary 1. Adjusted EBITDA unburdened for stock-based compensation, transaction costs and non-cash impairment costs; assumes 100% credit on expected run-rate operating synergies of $50M. • WillScot Mobile Mini to acquire McGrath (“McGrath”) for an enterprise value of $3.8B • Represents
Slide 7: McGrath overview
7 Mobile Modular 80% TRS 20% Commercial Construction,30% Industrial, Petro-Chemical, Manufacturing, Environmental, 8% Residential Construction, 8% General Business, 3% Transportation, 3% Government, 4% Health Care, 2% Entertainment & Recreation, 2% Retail, 1% Other, 6% McGrath overview ✓ One of the
Slide 8: McGrath segments
8 McGrath segments Mobile Modular TRS-RenTelco 1. Adjusted EBITDA unburdened for stock-based compensation, transaction costs and non-cash impairment costs. 2. Average rental equipment represents the cost of rental equipment, excluding new equipment inventory and accessory equipment. Key Highlights P
Slide 9: Compelling strategic and financial rationale
9 Compelling strategic and financial rationale Note: All data Pro Forma for acqusition of McGrath. 1. Reflects mid-point of latest 2023E guidance for continuing operations released by WillScot Mobile Mini and McGrath. 2. Assumes illustrative run-rate operating synergies of $50M. 3. ROIC defined as a
Slide 10: Combination enhances customer value proposition
10 Combination enhances customer value proposition ✓ Increased capabilities to service customers consistently ✓ Increased customer access to innovative products and services, including Value-Added Products, ProRack, Cold Storage, and ClearSpan structures ✓ Greater available fleet of ~475K pro forma
Slide 11: Complementary customer segments with benefits from diversification
11 Complementary customer segments with benefits from diversification Diverse Customer Segments1… …Driving Demand Broad-Based Exposure to GDP with Overweight to Non-Residential Construction Stable 2024 outlook with tailwinds from manufacturing, industrial, education and event-driven projects Support
Slide 12: Expected Run-Rate Operating Synergies of $50M
12 $740M $1,058M $1,424M $98M $72M $316M $50M $344M 2021 Divestitures M&A Organic Value Creation 2023E MGRC (2023E) Operating Synergies Pro Forma 2023E Expected Run-Rate Operating Synergies of $50M Adj. EBITDA Expansion via Organic & Inorganic Growth Track record of delivering identified operating s
Slide 13: Unique VAPS strategy and cross-selling will drive significant revenue upside
13 ShareShare 46 277 83 -40 -20 0 20 40 60 80 100 - 50 100 150 200 250 300 350 400 Unique VAPS strategy and cross-selling will drive significant revenue upside Track Record of Realizing VAPS Cross-Sell Synergies Clear visibility into high-margin revenue growth from the churn of the acquired portfoli
Slide 14: Continuing our strong track record of substantial value creation through profitable growth
14 Continuing our strong track record of substantial value creation through profitable growth 1. All metrics based on continuing operations unless otherwise stated. 2. Revenue CAGR for Q3 2023A LTM is relative to Q3 2022A LTM. 3. Assumes illustrative run-rate operating synergies of $50M. 4. ROIC def
Slide 15: Transaction financing overview
15 Transaction financing overview De-Leveraging DriversTransaction Sources ($M) Pro Forma Net Leverage ✓ Highly predictable sources of top line growth ✓ Operating synergies leading to margin expansion ✓ More efficient capital spending due to fleet pooling ✓ Potential review of non-core assets and re
Slide 16: Capital Allocation Framework
16 25% 25% 50% Net CapEx M&A Returns to Shareholders Capital Allocation Framework Accelerates free cash flow production and preserves long-term capital allocation framework • Combined company committed to continuing a disciplined capital allocation policy with deleveraging back into our targeted ran
Slide 17: Overlapping company values centered on customers and employees
17 Overlapping company values centered on customers and employees Complementary company cultures built upon a drive to excellence and focus on unlocking value for all stakeholders YOU matter Dedicated To Health & Safety WillScot Mobile Mini Key Values McGrath Key Values Committed To Inclusion & Dive
Slide 18: Acquisition benefits all stakeholders
18 Acquisition benefits all stakeholders Unique opportunity to drive shareholder returns Powerful cash flow characteristics allow us to compound growth over time Significant, high certainty synergies achievable based on WillScot Mobile Mini’s track record of substantial value creation through M&A En
Slide 19: WillScot Mobile Mini Holdings Corp
WILLSCOT = MOBILE MINI HOLDINGS CORP | mobile mini
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