Brookfield Business Partners acquires the Modular Group
BROOKFIELD, News, June 27, 2021 (GLOBE NEWSWIRE) – Brookfield Business Partners LP (NYSE: BBU) (TSX: BBU.UN) (“Brookfield Business Partners”) as well as Institutional Partners (collectively “Brookfield”) announced today hui an agreement to acquire Modulaire Group (“Modulaire”) for approximately 5 billion dollars.
Modulaire is a leading provider of modular rental services in Europe and Asia-Pacific serving the needs of a diverse customer base in the industrial, infrastructure and public sectors. With a global fleet of approximately 260,000 modular units in 25 countries, Modulaire serves more than 48,000 customers through an established network of approximately 180 branches. Its modular units offer customers a wide range of attractive, cost effective and environmentally friendly solutions for temporary space needs.
“We are delighted to expand our European operations with the acquisition of Modulaire, a market leader in the attractive and growing modular workspace industry,” said Anuj Ranjan, Managing Partner, Brookfield Business Partners. “We look forward to bringing our global reach and our capabilities to own and operate leading infrastructure services companies to support Modular’s growth, in partnership with the leadership team. “
- Leading position in the market. Modular is a market leader in Europe’s largest economies. Its large-scale branch network and differentiated service offerings contribute to strong and lasting relationships with a diverse clientele.
- Stable and diversified cash flow. Modular is geographically diversified with significant exposure to stable infrastructure, the public sector and industrial end markets supported by strong underlying demand and low customer concentration.
- Favorable market dynamics. Modular spaces respond to a structural change in customer demand for flexible and sustainable solutions with a reduced carbon footprint. The company is well positioned to take advantage of favorable industry winds, including growing investment in infrastructure and the public sector, and where there is increased demand for rental or modular solutions to replace permanent construction.
- Opportunities for growth and expansion of margins. Modular will continue to focus on acquisition and new market entry opportunities, expansion of the branch network across Europe, operational improvements and growth of ancillary services.
- Commitment to sustainability. Modular has a long-standing and demonstrated commitment to sustainable operations, as modular spaces are reusable and reconfigurable, reducing waste and maximizing their useful life.
Brookfield’s investment will be funded with approximately $ 1.6 billion in equity. Brookfield Business Partners intends to fund approximately $ 500 million, with the remainder funded by institutional partners. Before or after closing, a portion of Brookfield Business Partners’ engagement may be syndicated to other institutional investors.
The closing of the transaction remains subject to customary closing conditions, including regulatory approvals. The closure is scheduled for the end of 2021.
Brookfield Business Partners is a business and industrial service company focused on owning and operating high quality businesses that benefit from barriers to entry and / or low production costs.
Brookfield Business Partners is the flagship listed business and industrial services firm of Brookfield Asset Management, a leading global alternative asset manager with more than $ 600 billion in assets under management. More information is available at www.brookfield.com.
Brookfield Business Partners is listed on the New York and Toronto Stock Exchanges. For more important information, please visit our website at https://bbu.brookfield.com.
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CAUTION REGARDING FORWARD-LOOKING STATEMENTS AND INFORMATION
Note: This press release contains “forward-looking information” within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of Section 27A of the US Securities Act of 1933, as amended, from Section 21E of the US Securities Exchange Act of 1934, as amended, the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995 and any applicable Canadian securities regulations. Forward-looking statements include statements that are predictive in nature, depend on or refer to future events or conditions, include statements regarding operations, activities, financial condition, expected financial results, performance, outlook, opportunities, priorities, goals, objectives, objectives, strategies and prospects of Brookfield’s business partners, as well as the outlook for the North American and international economies for the current fiscal year and subsequent periods, and include words such as “expects”, “position”, “growth” and “intention,” or negative versions of these and other similar expressions, or future or conditional verbs such as “may” and ” will ”. Forward-looking statements contained in this press release include statements regarding the expected completion of the transaction described herein and the expected timing thereof, the financing of the transaction, and the future performance and operation of Modulaire and related growth initiatives.
Although we believe that our anticipated future results, performance or achievements expressed or implied by forward-looking statements and information are based on reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information as they imply unknown risks, uncertainties and other factors, many of which are beyond our control, that may cause the actual results, performance or achievements of Brookfield’s business partners to differ materially from the anticipated future results, performance or achievements expressed or implied by these forward-looking statements and information.
Factors that could cause actual results to differ materially from those envisaged or suggested by forward-looking statements include, but are not limited to: the impact or unforeseen impact of general economic, political and business factors in countries in whom we operate; including due to the ongoing novel coronavirus pandemic (“COVID-19”); the behavior of financial markets, including fluctuations in interest rates and exchange rates; global equity and capital markets and the availability of equity and debt financing and refinancing in these markets; strategic actions, including provisions; the ability to effectively complete and integrate acquisitions into existing operations and the ability to achieve expected benefits; changes in accounting policies and methods used to present the financial position (including uncertainties associated with critical accounting assumptions and estimates); the ability to appropriately manage human capital; the effect of applying future accounting changes; business competition; operational and reputational risks; technological change; changes in government regulations and laws in the countries in which we operate; government investigations; litigation; changes in tax laws; ability to collect amounts owed; catastrophic events, such as earthquakes; hurricanes and pandemics / epidemics; the possible impact of international conflicts and other developments, including terrorist acts and cyberterrorism; and other risks and factors detailed from time to time in our filings with securities regulators in Canada and the United States.
In addition, our future results may be affected by government-imposed economic restrictions resulting from COVID-19 and the related global reduction in trade and travel and substantial volatility in stock markets around the world, which may have a negative impact on our income, affect our ability to identify and conclude future transactions, impact our liquidity position and lead to a decrease in cash flows and impairment losses and / or revaluations of our investments and assets, and consequently , we may be unable to achieve the expected returns. See “Risks Associated with the COVID-19 Pandemic” in the “Risk Factors” section included in our MD&A on Financial Condition and Results of Operations in our Form 20-F for the year ended December 31 2020.
We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements, investors and others should carefully consider the above factors as well as other uncertainties and potential events. Except as required by law, Brookfield’s business partners do not undertake to publicly update or revise any forward-looking statements or information, whether written or oral, that may result from new information, future events or otherwise.