United Rentals Acquires Yak Access for $1.1 Billion

In a strategic move to bolster its specialty business, United Rentals, Inc. has finalized plans to acquire Yak Access, LLC, Yak Mat, LLC, and New South Access & Environmental Solutions, LLC (collectively known as "Yak") from Platinum Equity for approximately $1.1 billion in cash. The acquisition, expected to be completed in the first quarter of 2024, marks a significant step forward for United Rentals, positioning the company for growth and diversification in the matting industry.

Yak, a prominent player in the North American matting sector, boasts a fleet of approximately 600,000 hardwood, softwood and composite mats, catering to construction and maintenance, repair, and operations (MRO) applications. With a strong presence in the utility and midstream verticals, Yak generated $171 million of adjusted EBITDA on $353 million of adjusted revenue in 2023, spanning over 40 U.S. states.

The acquisition presents compelling strategic and financial rationale for United Rentals:

Strategic Rationale:

• The addition of Yak expands United Rentals' Specialty business into a new and growing segment, positioning the company as a comprehensive solution provider for customers.
• Cross-selling opportunities are expected to emerge, benefiting both existing and new customers across construction and MRO applications.
• Cultural alignment between United Rentals and Yak, characterized by a customer-centric approach and a strong emphasis on safety, sets a solid foundation for collaboration.

Financial Drivers:

• United Rentals anticipates significant growth potential in the matting business, driven by favorable market conditions in the energy and power sectors.
• Tax benefits valued at approximately $166 million are expected to enhance the overall value proposition of the acquisition.
• Operational efficiencies and overhead savings are projected to yield a $7 million benefit to adjusted EBITDA by the end of the second year post-closing.
• With a purchase price representing a multiple of 6.4 times adjusted EBITDA for 2023, the acquisition is expected to be immediately accretive to earnings per share (EPS) and free cash flow (FCF).

Commenting on the acquisition, Matthew Flannery, president and CEO of United Rentals, said, “Our acquisition of Yak further diversifies and differentiates United Rentals’ Specialty business offerings while also driving shareholder returns. This newly created ‘matting solutions’ business will create another adjacency for our company with scale in a large and growing market segment. In addition to its attractive profile across growth, margins and returns, this combination builds upon our Power vertical strategy, where significant investment in generation, transmission and distribution is expected over the next several decades.”

Flannery continued, “Yak meets the strategic, financial and cultural criteria we aim for in acquisitions. We expect this new line of business to augment our Specialty offerings as we continue to execute on our strategy of further differentiating ourselves by providing one-stop shop capabilities for our customers. We look forward to welcoming our new team members to the United Rentals family.”

Frank Bardonaro, CEO of Yak, said, “Yak is excited to accelerate its business potential as part of United Rentals. This combination will benefit both our customers and existing employees as our established expertise in access solutions complements the broader value proposition United Rentals offers. I’m proud of the leading company we built and am happy we found a great partner for the next chapter.”

Jacob Kotzubei, co-president of Platinum Equity and Matthew Louie, managing director, Platinum Equity, said in a joint statement: “Over the past six years we worked with the Yak team to transform the business and are proud that it is now a stronger and more resilient company ready for the next chapter. United Rentals is an outstanding partner and a great long-term fit for Yak going forward