TERRAVEST ANNOUNCES THE ACQUISITION OF KBK INDUSTRIES, LLC

Executive Summary

• TerraVest Industries Inc. announced the acquisition of KBK Industries, LLC for US $90 million cash.
• The purchase price equals approximately 5.6× KBK’s trailing twelve‑month EBITDA, indicating a value‑add transaction.
• Funding was sourced from TerraVest’s existing credit facility; the deal expands TerraVest’s fiberglass tank footprint into the U.S., adds geographic diversification and creates cross‑selling opportunities across North America.

Key Details

• Target: KBK Industries, LLC – Texas‑based manufacturer of fiberglass and steel storage tanks with facilities in Rush Center and Liberal, Kansas.
• Purchase Price: US $90.0 million cash (subject to a working‑capital adjustment ~90 days post‑closing).
• Valuation Multiple: ≈5.6× KBK’s trailing twelve‑month EBITDA (EBITDA after rent expense).
• Funding Source: TerraVest utilized its existing credit facility to finance the acquisition.
• Strategic Rationale:
• Adds an established U.S. manufacturer of aboveground and underground fiberglass tanks, complementing TerraVest’s Canadian operations and its Maryland‑based Composite USA assets (acquired Jan 2025).
• Enables leveraging TerraVest’s existing relationships in the convenience‑store (“C‑Store”) market to broaden KBK’s sales channels.
• Provides geographic diversification that mitigates tariff exposure across TerraVest’s platform.
• Operational Fit: The combined entity will offer the broadest product portfolio across fiberglass and steel tank markets in North America, enhancing optionality for existing customers of both companies.
• Management Comment: John Jacob, President of Highland Tank Holdings (TerraVest subsidiary), highlighted KBK as a “strong strategic fit” that expands TerraVest’s product offering and market reach.

Notable Quotes

“KBK is a strong strategic fit for TerraVest, and in combination with Highland Tank and other TerraVest businesses, TerraVest now has the potential to provide the broadest product offering across the fiberglass and steel tank markets.” – John Jacob, President, Highland Tank Holdings, Inc.