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1 CONSTRUCTION,
ENGINEERING, BUILDING
MATERIALS & PRODUCTS
M A R K E T M O N I T O R
S U M M E R 2 0 1 4
Construction, Engineering, Building Materials & Products
2 CONSTRUCTION,
ENGINEERING, BUILDING
MATERIALS & PRODUCTS
Contents
INDUSTRY UPDATE 3
PUBLIC STOCK PERFORMANCE & VALUATIONS 5
M&A ACTIVITY & VALUATIONS 9
OVERVIEW OF SELECTED TRANSACTIONS 11
MID-MARKET M&A OVERVIEW 12
MOSS ADAMS OVERVIEW 13
SELECTED MAC TRANSACTIONS 17
3 CONSTRUCTION,
ENGINEERING, BUILDING
MATERIALS & PRODUCTS
Confidence in Growth Continues, Operating Margins Continue to Improve
Despite lower-than-expected growth in in the construction
industry most executives believe the recovery will continue,
and possibly accelerate, throughout the rest of the year,
according to the most recent ENR Construction Industry
Confidence Index (“CICI”) survey.
Industry executives believe that all construction market
sectors, as measured by the CICI, are in a growth mode, and
they expect operating margins to improve.
Confidence in a sustained recovery is evident from a lending
perspective as well: most larger contractors have noted that it
continues to get easier to obtain project financing from banks.
Despite the uptick in demand, pricing for materials has
remained moderate, easing fears from a year ago when prices
spiked along with the housing recovery.
Construction Spending Y/Y Growth
Materials and Construction Costs – Y/Y Growth
Source: US Census Bureau, Engineering News Record (ENR), Moss Adams Capital analysis.
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
Construction Cost Index Materials Price Index
Private Non-
residential
Construction
10.9%
Private Residential
Construction
7.1%
Total Construction
6.7%
Public Non-
residential
Construction
1.5% -20%
-10%
0%
10%
20%
30%
40%
4 CONSTRUCTION,
ENGINEERING, BUILDING
MATERIALS & PRODUCTS
Building Materials Sectors Continues to Lead, Engineering Sectors Underperforms
3-Year Indexed Stock Price Performance
Engineering Services remains as the only segment within the sector underperforming the S&P 500 over the past three years. Building Materials and Construction have outperformed the broader index by a meaningful amount while the Building Products segment is approximately even with the S&P 500.
Note: The Construction, Engineering, Building Products & Materials indices are market cap-weighted indices comprised of the public companies included on pages 5-7. Source: S&P Capital IQ
Building Materials
90%
Construction
63%
Building Products
45%
S&P 500
46%
Engineering
9%
-50%
-25%
0%
25%
50%
75%
100%
125%
Ma
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5 CONSTRUCTION,
ENGINEERING, BUILDING
MATERIALS & PRODUCTS
Small Mid-Cap Public Company Valuations
Note: Not meaningful (NM) if EV/Sales is greater than 10x, or EV/EBITDA is greater than 50x. NA if denominator is 0, for percentages and multiples, or if estimates are not available. NTM figures are based on the median estimate of Wall St. analysts.
Source: S&P Capital IQ
($US in millions, except where noted and per share amounts) TTM Data EV Multiple
7/1/14 52 week Market Enterprise EBITDA TTM TTM NTM NTM
Company Name Share Price High/Low Cap Value Sales EBITDA Margin Sales EBITDA Sales EBITDA Sales EBITDA
Fluor Corporation $78.03 $83.93 / $57.50 $12,238 $10,582 $25,551 $1,356 5.3% 1.1% 1.8% 0.4x 7.8x 0.4x 7.7x
Jacobs Engineering Group Inc. 53.49 66.88 / 52.57 7,047 7,396 12,469 736 5.9% 11.9% 21.9% 0.6x 10.0x 0.5x 8.2x
Teledyne Technologies Inc. 98.64 102.40 / 76.26 3,646 4,178 2,343 338 14.4% 3.7% 15.8% 1.8x 12.4x 1.7x 10.7x
KBR, Inc. 24.23 36.70 / 22.48 3,467 2,451 7,018 115 1.6% (4.9%) 237.4% 0.3x 21.3x 0.4x 6.3x
Foster Wheeler AG 34.47 34.93 / 20.20 3,409 3,041 3,250 237 7.3% 26.0% 38.6% 0.9x 12.8x 0.7x 9.2x
AECOM Technology Corporation 32.42 35.24 / 27.35 3,196 3,879 7,973 441 5.5% (0.8%) 9.1% 0.5x 8.8x 0.5x 8.1x
URS Corporation 46.72 55.79 / 41.62 3,162 5,194 10,725 692 6.5% 1.4% 7.8% 0.5x 7.5x 0.5x 7.0x
Stantec Inc. 61.96 72.34 / 43.81 2,892 3,255 1,710 230 13.5% 26.8% 35.9% 1.9x 14.1x 1.5x 10.4x
McDermott International Inc. 8.06 9.36 / 6.58 1,922 2,049 2,455 (340) NA 8.9% NA 0.8x NA 0.8x 14.7x
Tetra Tech Inc. 27.63 30.92 / 22.21 1,786 1,827 1,946 122 6.3% 3.4% 89.1% 0.9x 15.0x 0.9x 7.9x
CACI International Inc. 70.98 80.77 / 60.52 1,650 2,922 3,572 328 9.2% (2.1%) (1.7%) 0.8x 8.9x 0.8x 9.0x
Tutor Perini Corporation 32.13 32.11 / 18.02 1,540 2,226 4,138 267 6.4% 11.6% 13.2% 0.5x 8.4x 0.5x 7.4x
VSE Corp. 72.60 70.35 / 39.98 377 479 472 65 13.8% (4.7%) 0.9% 1.0x 7.3x 1.1x 7.3x
Perma-Fix Environmental Services Inc. 4.59 5.86 / 1.96 53 70 65 (2) NA (11.9%) NA 1.1x NA 1.2x 13.6x
Median $2,981 $3,411 $252 6.4% 2.4% 14.5% 0.8x 9.5x 0.8x 8.2x
Average $3,539 $5,978 $328 8.0% 5.0% 39.1% 0.9x 11.2x 0.8x 9.1x
NTM Est. Growth
Engineering Firms
6 CONSTRUCTION,
ENGINEERING, BUILDING
MATERIALS & PRODUCTS
Small Mid-Cap Public Company Valuations
Note: Not meaningful (NM) if EV/Sales is greater than 10x, or EV/EBITDA is greater than 50x. NA if denominator is 0, for percentages and multiples, or if estimates are not available. NTM figures are based on the median estimate of Wall St. analysts.
Source: S&P Capital IQ
($US in millions, except where noted and per share amounts) TTM Data EV Multiple
7/1/14 52 week Market Enterprise EBITDA TTM TTM NTM NTM
Company Name Share Price High/Low Cap Value Sales EBITDA Margin Sales EBITDA Sales EBITDA Sales EBITDA
Quanta Services, Inc. $35.04 $37.42 / $25.57 $7,534 $7,277 $6,700 $711 10.6% 16.4% 16.1% 1.1x 10.2x 0.9x 8.8x
Chicago Bridge & Iron Company N.V. 69.07 89.22 / 57.73 7,373 9,161 11,771 974 8.3% 14.1% 20.3% 0.8x 9.4x 0.7x 7.8x
EMCOR Group Inc. 45.15 48.00 / 36.26 2,996 2,952 6,448 311 4.8% 6.3% 23.7% 0.5x 9.5x 0.4x 7.7x
MasTec, Inc. 31.41 44.80 / 27.96 2,390 3,280 4,370 420 9.6% 7.4% 16.6% 0.8x 7.8x 0.7x 6.7x
Primoris Services Corporation 29.02 33.42 / 19.35 1,490 1,536 2,004 182 9.1% 10.3% 11.0% 0.8x 8.5x 0.7x 7.6x
Granite Construction Incorporated 36.66 40.55 / 27.88 1,407 1,278 2,268 60 2.7% 15.6% 192.4% 0.6x 21.1x 0.5x 7.2x
Dycom Industries Inc. 32.06 34.00 / 23.31 1,063 1,457 1,808 182 10.0% 3.0% 15.1% 0.8x 8.0x 0.8x 7.0x
Matrix Service Company 33.01 38.71 / 15.45 866 853 1,154 76 6.6% 25.4% 23.0% 0.7x 11.3x 0.6x 9.1x
Comfort Systems USA Inc. 16.24 20.95 / 14.04 592 579 1,353 61 4.5% 12.2% 27.7% 0.4x 9.5x 0.4x 7.4x
MYR Group, Inc. 25.89 27.30 / 18.86 540 485 917 87 9.5% 2.5% 0.3% 0.5x 5.5x 0.5x 5.5x
Great Lakes Dredge & Dock Corporation 8.10 9.44 / 6.28 478 706 726 67 9.2% 12.5% 52.1% 1.0x 10.6x 0.9x 6.9x
Orion Marine Group, Inc 10.98 13.77 / 9.20 297 282 361 23 6.4% 13.3% 45.9% 0.8x 12.1x 0.7x 8.3x
Sterling Construction Co. Inc. 9.34 12.37 / 6.72 176 199 580 (44) NA 16.9% NA 0.3x NA 0.3x 6.9x
Median $1,278 $1,808 $87 8.7% 12.5% 21.7% 0.8x 9.5x 0.7x 7.4x
Average $2,311 $3,112 $239 7.6% 12.0% 37.0% 0.7x 10.3x 0.6x 7.5x
NTM Est. Growth
Construction Firms
7 CONSTRUCTION,
ENGINEERING, BUILDING
MATERIALS & PRODUCTS
Small Mid-Cap Public Company Valuations
Note: Not meaningful (NM) if EV/Sales is greater than 10x, or EV/EBITDA is greater than 50x. NA if denominator is 0, for percentages and multiples, or if estimates are not available. NTM figures are based on the median estimate of Wall St. analysts.
Source: S&P Capital IQ
($US in millions, except where noted and per share amounts) TTM Data EV Multiple
7/1/14 52 week Market Enterprise EBITDA TTM TTM NTM NTM
Company Name Share Price High/Low Cap Value Sales EBITDA Margin Sales EBITDA Sales EBITDA Sales EBITDA
Vulcan Materials Company $64.60 $69.50 / $46.21 $8,339 $10,077 $2,807 $463 16.5% 4.5% 45.2% 3.6x 21.7x 3.4x 15.0x
Martin Marietta Materials Inc. 133.35 $136.36 / $94.01 6,106 7,174 1,979 400 20.2% 21.0% 21.6% 3.6x 17.9x 3.0x 14.7x
Eagle Materials Inc. 95.69 $97.25 / $63.53 4,726 5,101 898 232 25.9% 23.6% 67.6% 5.7x 22.0x 4.6x 13.1x
Texas Industries Inc. 93.29 $95.35 / $53.23 2,665 3,276 863 88 10.2% 17.9% 107.8% 3.8x 37.3x 3.2x 18.0x
Headwaters Incorporated 13.97 $14.16 / $8.30 1,020 1,479 734 111 15.1% 11.9% 30.3% 2.0x 13.3x 1.8x 10.2x
United States Lime & Minerals, Inc. 65.42 $68.50 / $50.51 361 335 139 38 27.6% 5.6% NA 2.4x 8.7x 2.3x NA
Monarch Cement Co. 26.20 $27.24 / $21.55 68 83 130 18 13.9% NA NA 0.6x 4.6x NA NA
Median $3,276 $863 $111 16.5% 14.9% 45.2% 3.6x 17.9x 3.1x 14.7x
Average $3,932 $1,079 $193 18.5% 14.1% 54.5% 3.1x 17.9x 3.1x 14.2x
NTM Est. Growth
($US in millions, except where noted and per share amounts) TTM Data EV Multiple
7/1/14 52 week Market Enterprise EBITDA TTM TTM NTM NTM
Company Name Share Price High/Low Cap Value Sales EBITDA Margin Sales EBITDA Sales EBITDA Sales EBITDA
Masco Corporation $22.23 $23.73 / $18.27 $7,915 $10,370 $8,262 $909 11.0% 6.9% 18.1% 1.3x 11.4x 1.2x 9.7x
Owens Corning 39.12 46.64 / 34.41 4,555 6,915 5,223 734 14.1% 4.3% 8.2% 1.3x 9.4x 1.3x 8.7x
USG Corporation 30.23 36.22 / 22.55 4,352 6,450 3,606 431 12.0% 10.7% 39.7% 1.8x 15.0x 1.6x 10.7x
Armstrong World Industries, Inc. 57.79 61.90 / 45.81 3,148 4,136 2,732 288 10.6% 5.1% 50.7% 1.5x 14.3x 1.4x 9.5x
Simpson Manufacturing Co., Inc. 37.00 37.49 / 29.15 1,779 1,568 720 122 16.9% 9.1% 12.7% 2.2x 12.9x 2.0x 11.4x
NCI Building Systems Inc. 19.73 20.14 / 11.22 1,429 1,654 1,334 38 2.9% 10.7% 204.8% 1.2x 43.4x 1.1x 14.2x
Trex Co. Inc. 29.08 43.43 / 20.63 968 1,044 335 38 11.4% 25.5% 171.8% 3.1x 27.3x 2.5x 10.0x
Universal Forest Products Inc. 49.85 58.52 / 36.01 968 1,133 2,470 112 4.5% 15.4% 31.1% 0.5x 10.1x 0.4x 7.7x
Builders FirstSource, Inc. 7.80 9.40 / 5.15 733 1,024 1,516 61 4.0% 16.7% 63.8% 0.7x 16.8x 0.6x 10.3x
Quanex Building Products Corporation 18.35 21.84 / 15.66 670 544 983 58 5.9% (36.0%) 14.3% 0.6x 9.5x 0.9x 8.3x
Gibraltar Industries, Inc. 15.99 19.23 / 12.62 478 614 822 70 8.6% 7.2% 23.0% 0.7x 8.7x 0.7x 7.1x
Median $1,568 $1,516 $112 10.6% 9.1% 31.1% 1.3x 12.9x 1.2x 9.7x
Average $3,223 $2,546 $260 9.2% 6.9% 58.0% 1.3x 16.3x 1.2x 9.8x
NTM Est. Growth
Building Materials Firms
Building Products Firms
8 CONSTRUCTION,
ENGINEERING, BUILDING
MATERIALS & PRODUCTS
Building Materials
19.8x
Building Products
12.2x
S&P 500
10.3x
Engineering
10.1x
Construction
9.3x
0.0x
5.0x
10.0x
15.0x
20.0x
25.0x
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4.6%2.4%
12.5%
14.9%
9.1%
13.1%14.5%
21.7%
45.2%
31.1%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
S&P 500 Engineering Construction BuildingMaterials
BuildingProducts
Est. NTM Sales Growth
Est. NTM EBITDA Growth
EV/EBITDA multiples in the Construction and Engineering
segments continue to converge with the rest of the sector, as
well as the S&P 500 index.
Building Materials is the exception, trading at almost twice the
EV/EBITDA multiple of the S&P 500.
Public Market Valuations Next 12 Months: Estimated Sales & EBITDA Growth
Valuations Continue to Converge While Growth Expectations Remain Strong
EBITDA growth in all four segments is expected to outpace the
S&P 500, ranging from 14.5% to more than 45%, versus 13%
for the broader index.
Note: The Construction, Engineering, Building Products & Materials indices are market cap-weighted indices comprised of the public companies included on pages 5-7. Source: S&P Capital IQ
9 CONSTRUCTION,
ENGINEERING, BUILDING
MATERIALS & PRODUCTS
$ in millions
Announced Transaction
Date Acquirer/Investor Target Target Description Value Metric
6/23/2014 NIBE Industrier AB (publ) WaterFurnace Renewable Energy, Inc. Manufactures geothermal water source heating systems. $352.3 2.8x Rev; 16.3x EBITDA
5/12/2014 HC2 Holdings, Inc. Schuff International, Inc. Operates as a steel fabrication and erection contractor. $94.9 0.4x Rev; 5.3x EBITDA
4/7/2014 Comfort Systems USA Inc. DynaTen Corporation Provides engineering, mechanical contracting, and maintenance services. $41.5
3/26/2014 ForceField Energy Inc. American Lighting Supply Operates as a lighting retrofit contractor. $23.3
2/17/2014 Indiana Commercial Finance, LLC Victor Oolitic Stone Company Provides Indiana limestone for landscape designs. $26.0
1/27/2014 Martin Marietta Materials Inc. Texas Industries Inc. Engages in the manufacture and sale of heavy construction materials. $2,767.5 3.8x Rev; 37.2x EBITDA
1/14/2014 Insurance Services Office, Inc. EagleView Technologies, Inc. Operates as a provider of aerial imagery, data analytics, and GIS solutions. $637.0 5.3x Rev; 17.9x EBITDA
11/11/2013 John Wood Group PLC Elkhorn Holdings, Inc. Operates in industrial construction and fabrication businesses. $217.4 0.9x Rev
11/4/2013 AMEC plc Automated Engineering Services Corp. (nka:AMEC AES)Provides engineering and support services to the nuclear power industry. $35.0 1.2x Rev
10/8/2013 SolarCity Corporation Zep Solar, Inc. Designs mounting hardware for photovoltaic system applications. $158.0
9/13/2013 Atkore Plastic Pipe Corporation Heritage Plastics, Inc. Manufactures polyvinyl chloride conduit products. $89.5
9/3/2013 Versar Inc. Geo-Marine, Inc. Provides engineering, design and construction management services. $6.5 0.3x Rev
8/26/2013 Quikrete Holdings, Inc. Custom Building Products, Inc. Manufactures flooring products and tile and stone installation systems. $765.0
8/19/2013 Rockwool International A/S Chicago Metallic Corporation, Inc. Manufactures architectural building products and services. $140.0 1.0x Rev
8/10/2013 Rockwell Collins Inc. ARINC Incorporated Provides communications, engineering, and systems integration support. $1,390.0
7/24/2013 Golden Nugget, Inc. Ameristar Casino Lake Charles, LLC Develops casino resorts. $215.0
6/28/2013 LIXIL Corporation AS America, Inc. Manufactures bath and kitchen products. $542.0 0.6x Rev; 18.3x EBITDA
6/24/2013 Leonard Green & Partners, L.P. United States Infrastructure Corporation Operates as an underground utility damage prevention company. $700.0
6/24/2013 Lone Star Funds Lafarge North America Inc., Gypsum Division (nka:Continental Building Products, Inc.)Manufactures gypsum wallboard and complementary finishing products. $700.0
6/17/2013 EMCOR Group Inc. RepconStrickland, Inc. Provides recurring turnaround and specialty services. $455.0 1.1x Rev
Notable M&A Transactions
Highlighted in Overview of Selected Transactions on page 11. Source: S&P Capital IQ
Deal Revenue EBITDA
Size Multiple Multiple
Transactions Represented 18 10 5
High $3,305.6 5.3x 37.2x
Median $186.5 1.1x 17.9x
Mean $474.2 1.7x 19.0x
Low $6.5 0.3x 5.3x
10 CONSTRUCTION,
ENGINEERING, BUILDING
MATERIALS & PRODUCTS
Recent M&A Transactions
Source: S&P Capital IQ
$ in millions
Announced
Date Acquirer/Investor Target Target Description
6/26/2014 Empresas ICA, S.A.B. de C.V. Facchina Construction Company, Inc. Offers heavy highway, concrete frames, site development, and commercial building services.
6/24/2014 ExTech Industries, Inc. Pasvalco Corp. Offers custom stone fabrication and natural stone distribution services.
6/24/2014 Private Investor International Glass Solutions LLC Offers film based glazing solutions.
6/24/2014 Dos Rios Partners Case Drilling & Pump Service, LLC Provides water well drilling and maintenance services.
6/23/2014 IWM Acquisition Corp. Ideal Window Manufacturing Inc. Manufactures and services replacement and new construction windows.
6/23/2014 Timmons Group, Inc. Development Consulting Services, Inc. Provides civil engineering services.
6/23/2014 NIBE Industrier AB (publ) WaterFurnace Renewable Energy, Inc. Manufactures geothermal water source heating, cooling, hot water, and control systems.
6/18/2014 Salas O'brien Engineers, Inc. Kalmans Marshall Engineering, Inc. Specializes in the design of mechanical, electrical, plumbing, and technology systems.
6/17/2014 Compagnie de Saint-Gobain Phoenix Coating Resources, Inc. Manufactures ceramic ingots used to produce high-resistance thermal coatings.
6/17/2014 Triton Glass LLC Albemarle Glass Company, Inc. Manufactures glass products.
6/17/2014 Seven Point Equity Partners, LLC The RiteScreen Company, Inc. Produces screens for the window and patio door industry.
6/16/2014 The Stellar Group, Inc. Industrial Refrigeration Svc. & Eng. Inc. Operates as an independent refrigeration contracting company.
6/13/2014 The Earthwise Group, LLC Advanced Window Products, Inc. Manufactures and installs windows, doors, vinyl sidings, and roofs.
6/10/2014 Hatch Ltd. Interralogic Inc. Provides feasibility studies, engineering, geochemistry, hydrology and systems optimization services.
6/9/2014 Bridger Steel, Inc. Metal Roofing & Trim Mfg., LLC Metal Roofing & Trim Mfg.
6/5/2014 CIVC Partners, L.P. Track Utilities, Inc. A utility installation company that provides preparation, installation, and testing services.
6/5/2014 Milliken Infrastructure Solutions, LLC Edge Structural Composites, Inc. Provides composite retrofitting and strengthening products for specialty contractors.
6/3/2014 United States Environmental Services, LLC K2 Industrial Services, Inc. Provides industrial coatings, insulation, fireproofing, roofing and metal building erection services.
6/2/2014 Baywa re GmbH Martifer Solar USA, Inc. Provides integrated solutions for the implementation of solar photovoltaic projects.
5/29/2014 Private Investor Hylan Provides fiber optic data communications contract services.
5/29/2014 KCI Technologies Inc. Redding Linden Burr Inc. Operates as a mechanical, electrical, and plumbing engineering company.
5/27/2014 Timmons Group, Inc. Baldwin & Gregg, Ltd. Provides land surveying services.
5/21/2014 Gac, Inc. Desert Valley Mechanical, LLC Operates as a heating, ventilation, and air conditioning contractor.
5/21/2014 Xentry Systems Integration, LLC Acree Daily Integrated Systems, Inc. Installs security, access control, fire alarm, asset tracking and other systems.
5/16/2014 Huntington Ingalls Industries, Inc. UniversalPegasus International, Inc. Provides project management, engineering, and construction services for the energy industry.
5/16/2014 CE Power Solutions, LLC Hope Engineering Services Co. Provides electrical services.
5/14/2014 POWER Engineers, Inc. Burns & Roe Enterprises Inc. Provides engineering services.
5/13/2014 Poten & Partners, Inc. Merlin Associates, LLC Offers technical consulting services for energy companies and commercial banks.
5/12/2014 HC2 Holdings, Inc. Schuff International, Inc. Operates as a steel fabrication and erection contractor.
5/8/2014 RIG Construction, Inc. Camelback Pools, LLC Builds swimming pools and spas.
11 CONSTRUCTION,
ENGINEERING, BUILDING
MATERIALS & PRODUCTS
Overview of Selected Transactions
Source: S&P Capital IQ and company press releases
Comfort Systems USA, Inc. (NYSE: FIX, Houston, TX) acquires DynaTen Corporation (Fort Worth, TX)
May 1, 2014
Comfort Systems USA Inc. acquired DynaTen Corporation on May 1, 2014 for $41.5 million and an additional earn-out not to exceed $4 million. The acquisition is expected to be slightly accretive during the first 12 to 18 months.
DynaTen engages in a broad range of mechanical contracting projects, HVAC service and controls, in the Dallas/Fort Worth metroplex and in surrounding areas. Dyna Ten is expected to contribute annualized revenues of approximately $70 million to $80 million at profitability levels that are generally equal to or above those currently experienced by Comfort Systems.
Comfort Systems USA is a premier provider of business solutions addressing workplace comfort, with 89 locations in 80 cities around the nation. The company was founded in 1917.
ForceField Energy Inc. (NADAQCM: FNRG, New York, NY) acquires American Lighting & Distribution (San Diego, CA)
April 28, 2014
ForceField Energy Inc. announced that it has completed its acquisition of American Lighting & Distribution from private equity firm Forrest, Binkley & Brown. In consideration for the acquisition, ForceField paid $2.5 million in cash, 289,529 shares worth $1.7 million and $1.0 million in debt. The transaction also includes additional performance-based compensation.
American Lighting has successfully serviced thousands of satisfied clients since 1986. As an award winning, licensed electrical and commercial lighting contractor in the State of California, it has performed more than 2,500 installations over the past three years. Its geographic footprint covers much of the western US, and has reached as far east as Georgia. In 2013, it generated revenues of approximately $7.0 million with an adjusted EBITDA margin of 13%.
ForceField Energy Inc. produces alternative energy products and technologies, including LED lighting products and fixtures and trichlorosilane, a chemical used for the production of polysilicon that is utilized as a raw material in the production of solar cells for photovoltaic panels.
Announced Middle Market M&A Transactions
Note: Middle market M&A includes transactions with
EV < $500mm, and transactions with undisclosed EV.
YTD as of July 01, 2013.
202
176
228
215
237
199
101
107
60
9193
95
59
28
0
50
100
150
200
250
300
350
2008 2009 2010 2011 2012 2013 2014YTD *
Nu
mb
er
of
An
no
un
ced
Tra
nsa
ctio
ns
Building Products & Materials
Construction & Engineering
12 CONSTRUCTION,
ENGINEERING, BUILDING
MATERIALS & PRODUCTS
2,855 2,953 2,927
3,080 2,984
3,682 3,681 3,852
3,539 3,453
3,622
3,986
3,134
3,319
4,092 4,054 3,997 4,095
$32
$43
$56 $55
$47
$71 $72 $70
$52$56
$52
$66
$44
$50
$65
$71
$55
$70
$0
$20
$40
$60
$80
$100
$120
$140
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2010 2011 2012 2013 2014
Transactio
n V
alue ($
bn
)Nu
mb
er o
f Tr
ansa
ctio
ns
Number Value
4.8x
6.7x
6.4x
7.0x6.7x 6.8x 6.8x 6.9x
5.9x
6.4x6.2x 6.2x 6.4x
6.0x6.2x
7.2x7.0x
6.1x
15.0%14.2%
15.3%14.5%
16.7% 16.6% 16.9%
15.0%
12.4% 13.0%14.6%
16.7%15.3% 14.8%
13.7%
10.6%
17.0% 17.0%
0%
5%
10%
15%
20%
25%
30%
35%
40%
0.0 x
1.0 x
2.0 x
3.0 x
4.0 x
5.0 x
6.0 x
7.0 x
8.0 x
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2010 2011 2012 2013 2014
EBITD
A M
argin
EV/T
raili
ng
EBIT
DA
Mu
ltip
le
EV/EBITDA EBITDA Margin
U.S. middle market M&A transaction volume in Q2 2014 rose 23% from one year ago and was up slightly compared to Q1 2014.
In deal value terms, U.S. middle market M&A activity in Q2 2014 grew approximately 40% from a year earlier and was up more than 27% compared to the prior quarter.
Significant amounts of cash on corporate balance sheets and in private equity funds, coupled with strong debt markets, continues to drive deal activity.
Q2 2014 EBITDA multiples of middle market transactions declined after enjoying two quarters of transactions that were valued almost one full turn of EBITDA higher.
EBITDA multiples are approximately where they were one year ago and inline with where they have been for most of the last two years.
Q2 2014 EBITDA margins of reportable transactions were virtually unchanged from last quarter but are still more than 2% higher than they were one year ago.
Middle Market M&A: Volume and Values Up Slightly Over Last Quarter, Up Significantly Over Last Year
U.S. Middle Market M&A 1 U.S. Middle Market M&A Valuations 2
1) Middle market M&A includes transactions with undisclosed values, and disclosed values where EV < $500 million. 2) Middle market M&A includes transactions with disclosed EBITDA, where EV < $500 million and EV/EBITDA < 10x. Note: transactions with disclosed EBITDA represent <5% of all transactions. Source: S&P Capital IQ.
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Moss Adams Business Segments
Moss Adams LLP
Founded in 1913 Focused on Middle Market & Emerging Cos. Headquartered in Seattle, Washington
2,000+ Employees 22 Offices in Western United States ~16,000 Corporate Clients
Moss Adams Accounting & Tax Practice
Moss Adams Capital LLC
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Expert Teams
I N D U S T R Y K N O W L E D G E M A T C H E D W I T H A N E X P E R I E N C E D T E A M
• Senior Level Attention
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Premier accounting and financial services advice for middle market construction, engineering, building material & products companies.
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Relationships
Industry Specific
Accounting
Investment Banking &
Transaction Support
Relevant Tax Expertise
Strategic Planning & Exit Advice
Construction, Engineering, Building Materials & Products Knowledge
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In addition to direct international relationships; as a founding member of Praxity, AISBL, a global alliance of independent accounting firms, Moss Adams provides access to trusted expertise in 96 countries worldwide.
Latin America and Caribbean Argentina, Brazil, Cayman islands, Chile, Colombia, Mexico, Puerto Rico, Uruguay, Venezuela
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Asia China, Indonesia, Japan, South Korea, Malaysia, Singapore, Taiwan, Thailand, Vietnam
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Global Reach
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CFxBorder- Global Reach with Local Relationships
Our Alliance with CFxB consists of 150+ M&A Professionals in more than 25 countries
Mazars Africa
40 offices
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25 offices
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15 offices
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William Buck CAA
6 offices
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6 offices
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1 office CH Reynolds CF
1 office
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Selected Moss Adams Capital Transactions
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Selected Moss Adams Capital Transactions
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Contact Us 999 Third Avenue
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Irvine, California 92614
Wiley P. Kitchell
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(206) 302-6780
Richard M. Anderson
Managing Director
(949) 221-4006
Tyler M. Dale
Vice President
(949) 221-4030
Harman K. Wales
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(206) 302-6770
Burr J. Dalton
Director
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949-221-4085