NRW Holdings shares rocket on Fredon Industries buyout
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More news: Shares in NRW Holdings soared after emerging from a trading halt as the company announced the $200 million acquisition of Sydney-based engineering group Fredon Industries.
NRW shares were up 7.4% to $4.08 at 1:10pm AEST, taking 12-month gains to 14%.
NRW Holdings to acquire Fredon Industries for $200m
More news: NRW Holdings has agreed to buy engineering group Fredon Industries for an enterprise value of up to $200 million.
The construction and mining contractor confirmed that Sydney-based Fredon will retain its executive management and its 2,500-strong workforce.
The acquisition will be funded from NRW's existing corporate debt facilities, and paid out across three tranches. This includes an initial cash amount of $122 million, an earn-out of up to $60 million following the company's 2025 results, and deferred cash of up to $18 million two years after completion.
NRW said the buyout marks a "further logical step change" and immediate earnings-per-share accretion.
Fredon has "clear visibility" on FY26 earnings, the group said, and is expected to generate revenue of $840 million and earnings before interest and tax of $40 million.
Established in 1968, Fredon has a footprint across Australia's east coast, as well as South Australia, Western Australia and New Zealand.
What they said: "Fredon represents a strategically and financially compelling acquisition for NRW, with the potential to drive further growth across the business and create long-term shareholder value," said NRW's chief executive and managing director Jules Pemberton.
"Fredon is highly complementary to NRW's existing operations and, with its well-recognised brand and strong long term client relationships, provides an attractive platform to expand into adjacent disciplines."
NRW Holdings enters trading halt ahead of 'strategic acquisition'
The news: Construction and mining contractor NRW Holdings has entered a trading halt on the ASX, pending the finalisation of the terms of a strategic acquisition.
The context: NRW requested the trading halt remains in place until the earlier of the company making an announcement about the acquisition, and the start of trading on Thursday.
