Q: Comments on the outlook for Byd after this big acquisition. How does this compare to the glass acquisition and will it have the same effect?
Thx
Thx
5i Research Answer:
BYD tends to make small acquisitions, but this is a big one at $1.3B. Joe Hudson brings significant geographic advantages and a similar operating model and should be a relatively easy integration. The deal adds $722M in sales, expands BYD's footprint and is accretive to EBITDA. Bigger companies tend to get better valuations and this is also important with BYD's new US listing (BGSI). Investors like the deal and the financing associated and we do as well. BYD has a fairly good track record with acquisitions and we would expect this one to also go well, but it is a bigger bet for the company.