For a while SXE has maintained a strong balance sheet to address organic and inorganic growth options. COVID was a disruption in pursuit of the latter, but the Trivantage acquisition metrics suggest it has been worth the wait. The up to $53.5m acquisition is highly EPS accretive given it’s largely cash funded, and dovetails with SXE’s diversification strategy. The acquisition multiple (up to a maximum of 4.5x EBIT) is reasonable, and Trivantage adds to visibility and creates opportunities for cross-selling and additional margin capture. We maintain a BUY call on a blended valuation of $0.82 (prior $0.65).
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