Sunbelt makes $650m acquisition and ups 2027 CapEx

Sunbelt Rentals has announced the US$650 million acquisition of Reliant Asset Management, a US modular space rental business that trades as Aries Building Systems.

Aries, which was founded in 2010 by brothers Barry and Michael Roman as a subsidiary of Reliant, operates from 17 rental locations across the US. It rents structures, mobile offices, classrooms and storage to customers in commercial, industrial and education markets.

In its investor presentation, Sunbelt said Aries represented a “highly complementary modular rental market with significant growth potential, clear adjacency with our existing site services offerings (temporary walls, ground protection, temporary fencing and temporary structures.)”

The acquisition was announced as Sunbelt released its final quarter and full-year results to 30 April, with annual revenues up 3.4% to $11.2 billion and fourth quarter sales 8.9% higher year-on-year at $2.8 billion.

Full year EBITDA was $4.7 billion, which is an EBITDA margin of 41.9%.

Sunbelt’s Specialty division in North America grew at 6% year-on-year, while general tool was up 2%. The UK business, meanwhile, reported 3% growth in dollars, but shrank by 2% at constant exchange rates for the full year.

Increasing fleet CapEx

The company’s outlook for the current financial year includes an increase in gross CapEx on fleet of up to 55%, to between $2.45 and $2.85 billion. That compares to $1.84 billion in the most recent financial year.

Sunbelt CEO Brendan Horgan said it had been a strong year for the business; “We finished the year with strong momentum with fourth quarter rental revenues in our North America Specialty segment increasing 15%, and our North America General Tool growing at 4%.

“With this momentum, we are well positioned to continuing driving profitable growth and deliver long-term value for our stockholders.”

He said the Reliant acquisition represented “a compelling opportunity to expand our Specialty offering and advance our Sunbelt 4.0 strategic objectives.

“Through this acquisition, we are demonstrating our capital allocation priorities and a clear intention to use our leadership position in North America to expand and grow across new highly complementary verticals”.

In its outlook for 2027 Sunbelt said it expected total revenues 4.5% to 7.5% higher than 2026.

Horgan said; “we are entering the year with strong top-line momentum. Our guidance reflects confidence in the underlying demand environment, the resilience of our structural growth and through-the-cycle free cash flow platform.”