Target Information

Industrea Acquisition Corp. (Nasdaq: INDUU, INDU, INDUW) has successfully concluded its business combination with Concrete Pumping Holdings, Inc. (CPHI), a transaction that was officially approved during Industrea’s special stockholders meeting on December 4, 2018. As a result of this merger, both Industrea and CPHI will operate as wholly owned subsidiaries of Concrete Pumping Holdings Acquisition Corp., which has since rebranded itself to Concrete Pumping Holdings, Inc. (CPH). CPH anticipates that trading of its common stock and warrants will commence on the Nasdaq Capital Market starting December 7, 2018, under the ticker symbols “BBCP” and “BBCPW,” respectively.

Concrete Pumping Holdings is recognized as the leading provider of concrete pumping services in the highly fragmented markets of the U.S. and U.K. The company operates under the well-established national brands Brundage-Bone and Camfaud, along with concrete waste management services provided under the Eco-Pan brand. Under the leadership of CEO Bruce Young, a veteran with 38 years of industry experience, CPH is poised to enhance its capabilities, reach, and service offerings in the concrete placement sector.

Industry Overview

The concrete pumping industry, pivotal within the construction sector, specializes in delivering concrete to challenging locations via truck-mounted booms. This method provides numerous advantages, including expedited project timelines, improved access to difficult construction sites, and enhanced safety protocols on job sites. Given the high labor costs associated with traditional concrete delivery methods, concrete pumping has become an increasingly sought-after solution, offering substantial cost efficiencies to clients.

In the U.S., CPH's extensive footprint comprises 80 locations spanning 22 states, which enables it to maintain a strong presence in various end markets, including commercial, infrastructure, and residential sectors. This diversification is further bolstered by a customer base exceeding 8,000, ensuring minimal customer concentration and a stable revenue stream.

In the U.K., CPH’s operations are similarly robust, with 28 locations under the Camfaud brand. The company's emphasis on providing specialized services and maintaining a highly skilled workforce positions CPH to effectively serve large and intricate construction projects, thereby driving demand for concrete pumping services across these markets.

The concrete waste management services offered under the Eco-Pan brand complements CPH's core service line, addressing environmental concerns related to concrete washout. This innovative approach not only ensures regulatory compliance but also promotes sustainable waste management practices, aligning CPH with growing industry demands for environmental responsibility.

Rationale Behind the Deal

This business combination marks a significant strategic move for CPH, providing an opportunity to access public capital markets and facilitate further expansion of its differentiated services. CEO Bruce Young expressed optimism about the transaction, noting that it enhances the company's access to resources necessary for growing operational scale, geographic reach, and service offerings.

With the differentiation provided by its extensive fleet and skilled operators, CPH is well-positioned to capitalize on growing demand in the concrete pumping and waste management markets. This merger is viewed as a critical catalyst to strengthen its competitive positioning and drive sustainable growth in the years to come.

Investor Information

Industrea Acquisition Corp., a special purpose acquisition company created by an affiliate of Argand Partners, was initially formed to engage in merging or purchasing firms in the industrial sector. Having completed its initial public offering in August 2017, Industrea raised approximately $230 million in cash proceeds, positioning the firm effectively for strategic acquisitions. As a result of the merger, former key figures from Industrea, including Howard Morgan and Tariq Osman, have taken active roles on CPH's new board of directors, indicating a continued commitment to supporting the company's strategic direction.

The merger has attracted advisory support from respected financial institutions such as B. Riley FBR and Stifel, enhancing the transaction's credibility and ensuring appropriate oversight during the business combination process. Legal expertise has been provided by prominent firms, assuring compliance and regulatory adherence throughout the merger process.

View of Dealert

From an investment perspective, the merger of Industrea Acquisition Corp. and Concrete Pumping Holdings appears to be a sound decision that leverages the strengths of both entities. CPH’s leading market position, coupled with its diverse service offerings, provides a solid foundation for future growth. The strategic access to capital that comes with being a publicly traded entity will allow CPH to scale operations and further solidify its competitive edge in the concrete pumping and waste management industries.

Moreover, the positive market dynamics, characterized by increasing demand for efficient concrete placement solutions, suggest potential for strong revenue growth. The company’s adeptness in addressing customer pain points—such as high labor costs through labor-efficient solutions—positions it well to attract new clients seeking cost-effective services.

Additionally, the commitment of experienced leadership and an established board ensures focused governance and strategic execution, which are pivotal for realizing the anticipated benefits from this merger. As the industry trends continue to favor concrete pumping solutions, the investment opportunity in CPH looks promising, suggesting that long-term stakeholders may witness substantial returns.

However, potential investors should remain cognizant of the challenges associated with the construction sector, including economic fluctuations and regulatory changes. Continuous monitoring of industry conditions and strategic adjustments will be essential to navigating these risks successfully. Overall, CPH represents a compelling investment opportunity with a well-defined path for growth grounded in market demands and operational execution.

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