Bird Construction Inc. · TSX:BDT
Bird Construction — Merger or Acquisition (July 2020)
22 slides from Bird Construction's merger presentation, Jul 29, 2020
Slide 1: Bird Construction Acquisition of Stuart Olson
Bird Construction Acquisition of Stuart Olson July 29, 2020 Teri McKibbon President & Chief Executive Officer Wayne Gingrich Chief Financial Officer
Slide 2: Disclaimer
DISCLAIMER This presentation contains forward-looking statements and information ("forward-looking statements") within the meaning of applicable Canadian securities laws. The forward-looking statements contained in this presentation are based on the expectations, estimates and projections of managem
Slide 3: Disclaimer Continued
DISCLAIMER CONTINUED Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not lim
Slide 4: Disclaimer Continued: Non-GAAP Measures and Terminology
DISCLAIMER CONTINUED Non-GAAP Measures and Terminology Throughout this presentation, management uses the following terms which have no standardized meaning prescribed by GAAP and are considered non-GAAP measures. Therefore, these terms may not be comparable with similar terms presented by other comp
Slide 5: Agenda
AGENDA New Platform for Growth The Businesses The Benefits Value Creation and Synergies Deal Summary / Path to Closing 5
Slide 6: New Platform for Growth
NEW PLATFORM The Bird-Stuart Olson combination will FOR GROWTH create a strong platform for growth: Establishes Bird as a Top 5 infrastructure construction and services company Combines two established peers with similar operating practices and culture Exciting new platform for the combined 50
Slide 7: Transaction Rationale
TRANSACTION RATIONALE Generates strategic, operational, and financial benefits, creating a platform poised for growth Scale / scope is transformative with greater diversification across services, end-markets and geographies Diversifies the business across a series of new platforms with increased
Slide 8: Stuart Olson Business Profile
STUART OLSON BUSINESS PROFILE Over 100-year history, sector-diversified portfolio with balanced exposure to a wide range of public, private, and industrial end markets Three operating segments with diverse customers: Industrial Group provides electrical, mechanical, instrumentation, high volta
Slide 9: Bird Profile Historical Performance
BIRD PROFILE >$3.0 Billion HISTORICAL PERFORMANCE In Combined Backlog and >$1.0B Pending Backlog Revenue Diversification Bird’s dynamic business model enables 10.3% the Company to adapt to market 20.3% 32.3% opportunities as they arise through the 44.0% 40.0% cycle 36.1% This strategic acquisiti
Slide 10: The Two Businesses Corporate Comparison
THE TWO BUSINESSES CORPORATE COMPARISON Bird Revenue Adjusted EBITDA Analyst Estimates Consensus(1) $1,600 $80 Consensus(1) 5.0% BDT-CA 2020 2021 3.9% Revenue Estimates $1,500 4.0% Analyst 1 $1,297 $1,600 $60 3.2% Analyst 2 $1,256 $1,482 $1,400 2.8% Analyst 3 $1,315 $1,591 $Millions 2.3% 3.0% $4
Slide 11: Combined Entity Footprint
COMBINED ENTITY FOOTPRINT Increased diversification across the country; opportunities to combine offices to facilitate collaboration and teamwork 11
Slide 12: Well Aligned Company Cultures and Values
WELL ALIGNED COMPANY CULTURES AND VALUES Similar history with roots dating back over 100 years in Canada Shared strategic focus on growth in our respective businesses Combined workforce of 5,000 people Bird Values Corporate Promise Safety Safety “Our target is zero” 1 Safety is a moral obligat
Slide 13: Pro Forma Financials
PRO FORMA FINANCIALS Revenue – Pro Forma Adjusted EBITDA – Pro Forma $3,000 Consensus(1) $120 Consensus(2) $2,488 $112 $2,436 $2,576 $101 $2,500 $2,348 $2,306 $2,369 $100 $2,161 $10 $2,248 $2,364 $87 $67 $2,000 $1,017 $967 $933 $2,052 $942 $80 $929 $76 $892 $60 $57 $3 $31 $1,500 $Millions $60 $M
Slide 14: Pro Forma Cash Flows
PRO FORMA CASH FLOWS Accretive acquisition at low leverage with strong cash flows to support dividend payments Operating Cash Flow (Before Non-Cash WC)(1) Capex(2) $80 Projected(3) $76 $20 Projected $15 $16 $60 $54 $15 $12 $15 $14 $44 $13 $4 $35 $4 $4 $40 $27 $15 $3 $4 $9 $9 $10 $23 $49 $20 $2 $
Slide 15: Pro Forma Leverage
PRO FORMA LEVERAGE Pro forma leverage remains one of the industry’s lowest, providing flexibility to successfully integrate and grow the combined business • The cash consideration will be funded through available capacity under Bird’s existing revolving credit facility with the Bank of Montreal. Non
Slide 16: Value Creation and Synergies
VALUE CREATION AND SYNERGIES Synergy Opportunities • Scale and broader service expertise to accommodate clients who increasingly seek to consolidate their vendor lists • Significant cross selling of complementary services across an expanded resilient service offering to a combined base of customers
Slide 17: Value Creation and Synergies
VALUE CREATION AND SYNERGIES Estimate of Synergies: • Post-transaction, it is expected that there will be redundant board fees, executive compensation and public company related fees. Income 2021E Before • Additional synergies assumed include optimizing leased facilities and Taxes direct cost saving
Slide 18: Transaction Summary BDT:SOX
TRANSACTION SUMMARY BDT:SOX Bird will acquire all of the issued and outstanding common shares of Stuart Olson (TSX: SOX) for an aggregate consideration of $96.5 million. THE The aggregate consideration of $96.5 million will consist of $30.0 ARRANGEMENT million cash and $66.5 million of the common sh
Slide 19: Transaction Details
TRANSACTION DETAILS The aggregate consideration is to be allocated amongst Stuart Olson’s secured creditors, unsecured convertible debenture holder (Canso Investment Counsel Ltd.), and shareholders, as follows: • Upon closing, an aggregate amount equal to $70.0 million will be paid by or on behalf o
Slide 20: Deal Timeline Path to Closing
DEAL TIMELINE PATH TO CLOSING • Targeting an October 2020 closing JULY AUGUST SEPTEMBER OCTOBER • July 29: Public • Mid/Late August: • Mid/Late September: • Transaction Closing Announcement of Mailing of Shareholder Shareholder Meeting Agreement Materials (SOX) (SOX) Key Filings Regulatory Approvals
Slide 21: Transaction Summary
TRANSACTION SUMMARY Creating a Premium Mid-Cap Construction Company Emerging as a leading mid-cap construction company, conveying broader public markets appeal and enhanced Pro forma revenue of approximately $2.5 billion, with a greater portion earned from recurring business Aggregate backlog of gre
Slide 22: Modular Industrial Energy &
Modular Commercial Industrial Energy & Resources Institutional Mass Transportation Timber Utilities 22
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