v3.26.1
Business Combination
 3 Months Ended
Mar. 31, 2026
Business Combination [Abstract]  
Business Combination Business Combination
On January 9, 2026, the Company acquired 100% of the issued and outstanding equity interest of MTL, for a total purchase price of $11.1 million subject to customary working capital and other post-closing adjustments (the “Acquisition”). MTL is engaged in the welding, fabrication, painting, and assembly of steel components. The acquisition expands the Company’s manufacturing capabilities and vertical integration, and it is expected to support future growth and operational efficiencies. The transaction was accounted for as a business combination under ASC 805, Business Combinations (“ASC 805”), using the acquisition method of accounting. Accordingly, the Company recognized the assets acquired and liabilities assumed at their estimated fair values as of the acquisition date.
Preliminary Purchase Price Consideration
The aggregate purchase price consisted of $10.0 million in cash and $1.1 million promissory note issued to the seller which bears interest at 8.0% per annum, and matures on January 9, 2031, with annual principal payments beginning in 2027. The note is secured by the acquired shares of MTL. Cash consideration paid at closing was subject to adjustment for estimated closing working capital and other items pursuant to the Stock Purchase Agreement. Any changes resulting from the final determination of these adjustments will be reflected as measurement period adjustments. The preliminary purchase price of MTL as of January 9, 2026 consists of the following:
(in thousands)
Amount
Cash paid at closing
$10,000 
Promissory note to seller1,125 
Working capital and other adjustments2,068 
Total consideration transferred
$13,193 
Preliminary Purchase Price Allocation
In accordance with ASC 805, the identifiable assets acquired and liabilities assumed were recorded at their estimated fair values as of January 9, 2026. The components of the preliminary allocation of the purchase price are summarized below:
(in thousands)
Fair Value
Purchase Price$13,193 
Accounts receivable3,095 
Inventory2,500 
Other assets93 
Property, plant & equipment8,786 
Operating lease-right-of-use assets7,507 
Intangible - Trade name620 
Accounts payables and other accrued liabilities(1,066)
Notes payable and long-term debt(5,921)
Operating lease liabilities(7,507)
Total identifiable net assets$8,107 
Goodwill$5,086 
Goodwill is calculated as the excess of the purchase price over the net assets acquired and primarily represents the future economic benefits expected from expected synergies, assembled workforce, expansion into new markets and is not deductible for U.S. federal income tax purposes. Identifiable intangible assets acquired in the transaction include trade names. For indefinite lived intangible assets, the Company applied the income approach through a relief from royalty method to fair value the trade name using Level 3 inputs. The Company amortizes trade names over 10 years.
The fair values of assets acquired and liabilities assumed are preliminary and are based on the information that was available to management at the time of the unaudited financial statements were prepared. The Company may record measurement period adjustments in the period they are identified, with such adjustments reflected as if they had been recognized as of the acquisition date. The measurement period may extend up to 12 months after the acquisition date. The finalization of the Company’s purchase accounting assessment could result in change in the valuation of assets acquired and liabilities assumed.
Consolidated Results of Operations
MTL’s results of operations have been included in the Company’s consolidated financial statements from the acquisition date of January 9, 2026 through the end of the reporting period. Revenue and net income attributable to MTL for the periods presented were not material to the Company’s consolidated results. Pro forma financial information has not been presented because the impact of this acquisition was immaterial to our consolidated financial statements.
Transaction Costs
The Company incurred less than $0.1 million of acquisition‑related costs during the three months ended March 31, 2026 and $0.2 million in 2025, primarily consisting of legal, advisory, valuation, and integration expenses. These expenses are included in selling, general and administrative expenses in the Consolidated Statements of Income.