Note 2 - Business Combination

9 Months Ended

Sep. 30, 2026

Notes to Financial Statements

Business Combination [Text Block]

2. Business Combinations

Serpentix Conveyor, LLC

On September 2, 2026, the Company completed the acquisition of 100% of the equity interests of Serpentix Conveyor, LLC (“Serpentix”), a Westminster, Colorado-based manufacturer of engineered conveyor systems used primarily in municipal wastewater treatment plants and industrial manufacturing facilities, for a purchase price of approximately $51.5 million, subject to a post-closing adjustment based on changes in net working capital. Serpentix is included in the Precast segment for all periods following the acquisition date. This acquisition complements the Company’s existing dewatering, separation, and mixing capabilities, broadens the solutions it can provide to municipal and industrial customers, and advances its strategy to expand its presence across essential water and wastewater infrastructure markets.

The following table summarizes the purchase consideration and fair value of the assets acquired and liabilities assumed as of September 2, 2026 (in thousands):

Assets
Cash and cash equivalents	$	1,844
Trade and other receivables		5,773
Inventories		1,186
Prepaid expenses and other		163
Property and equipment		2,658
Operating lease right-of-use assets		2,202
Intangible assets		13,200
Other assets		31
Total assets acquired		27,057
Liabilities
Accounts payable		741
Accrued liabilities		363
Contract liabilities		16
Operating lease liabilities		2,202
Total liabilities assumed		3,322
Goodwill		27,810
Total purchase consideration	$	51,545

The purchase consideration for this acquisition is preliminarily allocated to the assets acquired and liabilities assumed based upon fair values estimated as of the date of the acquisition. The Company has commenced the process to confirm the existence, condition, and completeness of the assets acquired and liabilities assumed to establish fair value of such assets and liabilities and to determine the amount of goodwill to be recognized as of the date of the acquisition. Goodwill recognized in this acquisition is primarily attributable to management’s industry know-how and expanded product and market opportunities, as well as other factors that are not individually identifiable or separately recognized, and is expected to be deductible for tax purposes. Due to the timing of this acquisition, the Company continues to gather information supporting the acquired assets and assumed liabilities. Accordingly, all amounts recorded are provisional. These provisional amounts are subject to change if new information is obtained concerning facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date. The final determination of the fair value of certain assets and liabilities will be completed within a measurement period of up to one year from the date of acquisition. The final values may also result in changes to goodwill and depreciation and amortization expense related to certain assets such as property and equipment and acquired intangible assets.

The following table summarizes the components of the intangible assets acquired and their estimated useful lives:

	Estimated Useful Life		Fair Value
	(In years)		(In thousands)
Customer relationships		8	$	8,800
Trade names and trademarks		14		4,400
Total intangible assets		10	$	13,200

The Company incurred transaction costs associated with this acquisition of $0.4 million during the three and nine months ended September 30, 2026. These transaction costs are included in Selling, general, and administrative expense in the Condensed Consolidated Statements of Operations.

Serpentix operations contributed net sales of $0.9 million to the Company’s continuing operations for the period from September 2, 2026 to September 30, 2026. It is impracticable to determine the effect on net income as a substantial portion of Serpentix has been integrated into the Company’s ongoing operations. The Company has not presented pro forma results of operations for this acquisition because it is not material to the Company’s consolidated financial statements.

Boughton’s Precast, Inc.

On February 23, 2026, the Company completed the acquisition of 100% of the shares of Boughton’s Precast, Inc. (“Boughton”), a single precast facility located in Pueblo, Colorado, for a purchase price of approximately $9.0 million. Boughton is included in the Precast segment for all periods following the acquisition date. This acquisition expands the Company’s geographic footprint for its stormwater infrastructure and sanitary sewer products including manholes, catch basins, vaults, and reinforced concrete pipe.

The following table summarizes the purchase consideration and fair value of the assets acquired and liabilities assumed as of February 23, 2026 (in thousands):

Assets
Cash and cash equivalents	$	147
Trade and other receivables		800
Inventories		1,898
Property and equipment		4,700
Intangible assets		1,496
Total assets acquired		9,041
Liabilities
Accounts payable		6
Accrued liabilities		35
Total liabilities assumed		41
Total purchase consideration	$	9,000

The purchase consideration for this acquisition was allocated to the assets acquired and liabilities assumed based upon fair values estimated as of the date of the acquisition. The fair value measurements primarily related to intangible assets, deferred income taxes, and accrued liabilities are preliminary and subject to change as additional information is obtained. The final determination of the fair value of assets and liabilities will be completed within the measurement period of up to one year from the date of acquisition.

The following table summarizes the components of the intangible assets acquired and their estimated useful lives:

	Estimated Useful Life		Fair Value
	(In years)		(In thousands)
Customer relationships		6	$	1,496

The Company incurred transaction costs associated with this acquisition of approximately $0 and $0.1 million during the three and nine months ended September 30, 2026, respectively. These transaction costs are included in Selling, general, and administrative expense in the Condensed Consolidated Statements of Operations.

Boughton operations contributed net sales of $3.8 million to the Company’s continuing operations for the period from February 23, 2026 to September 30, 2026. It is impracticable to determine the effect on net income as a substantial portion of Boughton has been integrated into the Company’s ongoing operations. The Company has not presented pro forma results of operations for this acquisition because it is not material to the Company’s consolidated financial statements.