Black Diamond Group to buy Royal Camp Services for C$165M

Black Diamond Group (TSX:BDI:CA [https://seekingalpha.com/symbol/BDI:CA]) has entered into an agreement to acquire all the issued and outstanding shares of Royal Camp Services, a remote accommodation and catering solution provider, for C$165 million.

Pursuant to the agreement, the purchase price is payable in cash or, at the option of the vendors of the purchased shares, a combination of cash and up to 4M common shares in the capital of Black Diamond, at a deemed price of C$12.08 per consideration share based on the 10-day volume weighted average price of Black Diamond’s common shares as of the date of deal.

The cash portion of the purchase price will be drawn from the company’s asset-based credit facility. Black Diamond expects to close the deal prior to the end of 2025.

The deal will create an integrated workforce accommodations and catering business with nearly 12,000 rooms of capacity across Canada. It is also expected to be highly accretive to Black Diamond with valuation based on the mid-point of a three-year adjusted EBITDA range for Royal of C$31 million to C$41 million, excluding anticipated synergies.

Management estimates that the fair market value of tangible net assets to be acquired in the deal is approximately equivalent to the purchase price.

Source: Press Release [https://seekingalpha.com/pr/20239241-black-diamond-group-limited-announces-strategic-acquisition-of-royal-camp-services-for-165]

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