Kingspan Group (KRX) investor relations material

Deal rationale and strategic fit

• Acquisition of BMC Manufacturing, a fast-growing power management systems provider for data centers, expands the product suite into power distribution cabinets and enables fully converged power, cooling, and containment solutions.

• BMC's technology and customer relationships enhance the data solutions portfolio, global reach, and align with next-generation data center requirements, including 800V systems.

• The deal leverages global relationships with hyperscalers and colocation providers, expanding reach and product integration.

• Enhances customer proposition by simplifying supply chains, improving quality, and accelerating deployment for hyperscaler and co-location programs.

• Opens up recurring revenue opportunities through product obsolescence and replacement cycles, with a typical refresh period of five years.

Financial terms and conditions

• Initial consideration of €850 million: €600 million in cash and €250 million in new shares, with up to €50 million earn-out contingent on achieving an average EBITDA of €250 million over the next three years.

• Implied EV/EBITDA multiple is approximately 5x for the first full year and below 5x FY27 EBITDA.

• Immediate post-deal net debt/EBITDA at 1.9x, expected to reduce to just over 1x by end of 2027.

• Year one return on capital expected to exceed 20%.

• Lockup of two years post-close on the new shares issued.

Synergies and expected cost savings

• Significant revenue synergies anticipated immediately, with doubling of business in year one driven by organic growth and leveraging existing customer relationships.

• EPS and margin accretive from year one, with trading margins in the high 20s to 30% range into 2027.

• No margin dilution anticipated; focus is on expanding product range and customer base.

• Acquisition enables a converged solution, increasing potential wallet share through global sales channels.

• BMC's technology will be integrated with existing offerings to serve a broader customer base.