Quanta services announced that it has completed the acquisition of Cupertino Electric Inc. (CEI), an electrical contractor and solar energy EPC headquartered in San Jose, California. CEI now joins fellow solar contractors Blattner, Ryan Companies and RPCS under the Quanta banner.
File photo of Cupertino Electric
“We are pleased to announce the acquisition of CEI, a company we have admired for more than a decade, and we welcome CEI employees to the Quanta family,” said Duke Austin, president and CEO of Quanta. “CEI brings an exceptional management team and a leading artisan-skilled workforce that complements Quanta’s culture and will create a comprehensive offering of electrical infrastructure solutions that we believe can facilitate innovative solutions between utilities and major power consumers – from electron generation to transmission to consumption. Furthermore, CEI Quanta offers a low-voltage electrical platform to further diversify and expand our customer base and service offerings. CEI has vibrant end markets, a strong and visible project backlog and a positive contribution to Quanta’s growth, cash flow conversion, returns and earnings per share.”
Tom Schott, President and CEO of CEI, said: “The opportunity to strategically partner with Quanta for the next phase of CEI’s growth journey is incredibly exciting for our employees and our long-standing customers. The people-first culture and customer-centric mindset that Quanta and CEI share is truly unique and should enable our organizations to achieve more together than we could alone. This transaction ensures that CEI’s 70-year legacy of great people and projects remains intact, and that CEI will be fueled into the future by the support of Quanta and its family of companies.”
CEI’s existing management team will remain in place, while Schott will continue in his leadership role as President and CEO. With a skilled, dedicated and high-quality workforce of approximately 4,300 employees, CEI will serve as Quanta’s platform company.
The upfront transaction price was approximately $1.54 billion, consisting of approximately $1.3 billion in cash, subject to certain closing adjustments, as well as approximately 883,000 shares of Quanta common stock valued at approximately $225 million. In addition, there is a potential earnout payment of up to $200 million, provided certain financial performance targets are achieved during a post-acquisition period. Quanta financed the cash portion of the transaction with a combination of cash on hand, draws under its existing credit facility and a short-term borrowing facility. The transaction closed on July 17, 2024.
King & Spalding LLP is serving as legal counsel for Quanta Services. Lazard serves as exclusive financial advisor to CEI, and Fenwick & West LLP serves as legal advisor.
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