Service Stream to Buy Programmed for $975 Million

Service Stream (ASX:SSM) has agreed to buy Programmed, a facility management, asset management and infrastructure services provider, from Persol for $975 million, funded partly by a fully underwritten $475 million equity raising.

The purchase price implies an Enterprise Value of $1,092 million, which includes Programmed lease liabilities of $117m, and an EV / LTM Jun-26 EBITDA multiple of 7.4x before synergies, or 6.1x after initial run-rate cost synergies of $30 million. Funding comprises a $219 million institutional placement, a $256 million 1 for 4.9 pro rata accelerated non-renounceable entitlement offer, $490 million drawn from debt facilities increased from $395 million to $895 million, and $50 million of existing cash. New shares will be issued at $2.03, a 7.7% discount to the last close of $2.20. Service Stream expects EPS-A accretion exceeding 20% on a pro forma FY27F basis including synergies, and mid-single digit accretion before synergies. Pro forma net debt / FY26 pro forma EBITDA is expected to be 2.2x at Completion. The combined group's FY26 pro forma revenue was approximately $6,155 million.

Completion, expected on or around 1 March 2027, is subject to ACCC approval and other customary conditions. The price may be reduced by up to $25 million if Programmed misses an EBITDA hurdle, and synergies are a management estimate.