Quanta Services Inc. agreed to acquire Blattner Holding Co. for $2.7 billion in cash and stock as part of the Houston-based service provider’s push into renewables.
Founded in 1907 and headquartered in Avon, Minnesota, Blattner is one of the largest and leading utility-scale renewable energy infrastructure solutions provider in North America. The company provides front-end engineering, procurement, project management and construction services to leading renewable energy developers for wind, solar and energy storage projects.
Duke Austin, Quanta’s president and CEO, commented that the company believes that what Quanta is to the electric power solutions industry, Blattner is to the utility-scale renewable energy solutions industry.
“Together, we will be focused on what we believe are the most attractive areas of the electric infrastructure complex,” Austin said in a company release on Sept. 2. “Blattner will bring an exceptional management team that we believe will enhance our ability to collaborate with our customers to shape North America's energy transition to a carbon-neutral economy.”
Quanta expects the acquisition, which sent its share price to a record high on Sept. 2, to add to the company’s growth, margins, cash flow conversion and earnings per share.
The company agreed to pay about $2.36 billion in cash and issue roughly $340 million of Quanta stock as part of the transaction consideration. Additionally, Blattner owners will be eligible for an earnout payment that could provide additional consideration of up to $300 million, to the extent certain financial performance targets are achieved, the company added.
Quanta obtained commitments from Bank of America and Wells Fargo for bridge financing, should it be needed, to complete the transaction. However, according to its release, the company expects to pursue certain other debt financing alternatives to finance the cash portion of the transaction consideration.
Following close of the transaction, expected fourth-quarter 2021, Blattner will serve as a platform operating unit of Quanta. Blattner’s existing management team will remain in place, including Scott Blattner continuing in his leadership role as president.
In the release, Blatter commented, “Our industry is on the cusp of significant evolution and this is an opportunity to add the additional scale and resources needed for our organization to continue leading and delivering certainty to our renewable energy customers.”
“Blattner was looking for a strategic partner with the resources and capabilities that will provide us the opportunity to strengthen our market position, take advantage of next-generation opportunities emerging in the renewable energy market and continue to contribute to the long-term success of our employees and customers. To that end, we believe Quanta is the ideal partner for Blattner,” he added.
Lazard is financial adviser and Latham & Watkins LLP is serving as legal adviser to Quanta for the transaction. J.P. Morgan Securities LLC is exclusive financial adviser to Blattner.
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