Under the terms of the agreement, MasTec will purchase all of IEA’s outstanding shares for $14 a share.
The $14 share price includes $10.50 a share in cash and 0.0483 of a MasTec share with a value of $3.50 a share, based on MasTec’s closing share price on 22 July, which represents a 34% premium to IEA’s closing stock price as of 22 July.
MasTec CEO Jose Mas said: “We are proud to expand our service capabilities, scale, and expertise providing critical infrastructure to support the nation’s energy transition to secure and sustainable renewable sources.
“We are excited to welcome JP, the IEA management team and almost 6,000 IEA team members to the MasTec family.
“We have long admired IEA’s operating excellence and we have a strong cultural alignment with IEA in safety and customer service.”
The deal is intended to significantly enhance MasTec’s clean energy and infrastructure segment, as well as its clean energy maintenance service offerings.
It will also increase the company’s non-union craft labour and equipment resource capacity.
The transaction is expected to close in the fourth quarter of this year subject to IEA stockholder approval, regulatory approvals and other customary closing conditions being met.
IEA president and CEO JP Roehm said: “The combination with MasTec will create new opportunities for IEA’s employees and our customer base.
“We believe that IEA stockholders will benefit from MasTec and IEA’s combined operations and scale, and this belief is reflected in our agreement to receive 25% of the transaction proceeds in MasTec common stock.”
JP Morgan Securities is serving as financial adviser to MasTec, while Fried Frank Harris Shriver & Jacobson and Holland & Knight are providing legal counsel to the company.
Lazard is acting as the financial advisor to IEA, with Gibson, Dunn & Crutcher serving as its legal counsel.