• The transaction closed on July 17th.
• The upfront transaction consideration was approximately $1.54 billion.
  • $1.3 billion paid in cash + 883,000 shares of Quanta common stock valued at approximately $225 million.
  • There is also a potential earnout payment of up to $200 million if certain performance targets are met.
• Cupertino Electric Inc. (CEI) 2024 Estimates:
  • Revenue: $2.1 billion to $2.2 billion
  • EBITDA: $155 million to $175 million
• CEI estimated contribution to Quanta for 2025:
  • Revenue: $2.325 billion to $2.425 billion
  • EBITDA: $175 million to $195 million
  • Adjusted diluted EPS: $0.40 to $0.50

Cupertino Electric, Inc. (CEI), headquartered in San Jose, California, is a leading provider of electrical infrastructure solutions. Their expertise spans technology, renewable energy, infrastructure, and commercial sectors.

The company employs 4,300 people and is the sixth-largest electrical solutions provider in the U.S., according to ENR.

CEI projects a revenue mix of 45% from the Technology segment, 40% from renewable energy initiatives, and 15% from Infrastructure & Commercial projects in 2024.

A quick overview of each of these businesses:

Technology

• Designs and installs electrical systems for large-scale data center projects.
• Is a premier custom manufacturer of modular electrical systems for large-scale data center projects.
• Customers include leading Fortune 500 companies and data center colocation companies.

Renewable Energy

• EPC of mid-sized utility-scale solar projects.
• EPC of utility-scale battery storage projects (stand-alone and colocated w/ solar).
• Customers include AES, Avangrid, Invenergy, and Nextera Energy.

Infrastructure & Commercial

• EPC of electrical systems for water/wastewater facilities, light rail, aviation facilities, including for government agencies.
• EPC of electrical systems for large-scale facilities across diversified industries, including technology and life sciences.
• Customers include Roche, Bayer, and other Fortune 500 companies.

Data Center Exposure

The deal will increase Quanta’s exposure to the technology sector and to data centers specifically. CEI has installed electrical systems in over 20 million square feet of data centers.

Quanta Services Statement:

CEI provides a premier electric platform that significantly increases Quanta’s exposure to the large and growing data center market, with industry experts estimating hyperscaler capital expenditures to grow at a double-digit CAGR over the next four years.

End-to-End Solution

Quanta says the deal will enable an “end-to-end electrical infrastructure solution from electron generation to transmission to consumption.”

In the video below, Quanta Services CEO Duke Austin discusses the potential for this combined solution:

This slide from the associated presentation highlights CEI’s complimentary capabilities on the consumption end, including Inside Electrical, Modular, and Testing & Commissioning.

Read the full presentation here.