Underground Construction - July 2020 - 15

fever pitch that the market has been on since
down, but it also a lagging indicator. Based
power distribution space with its acquisition
of Thayer Power and Communication.
on information from the Journal of American
March 18. Stock prices for UCCI increased
The buyer universe has expanded signifiMedicine Academy, the average time from
over 23 percent during that timeframe and
contraction of the disease to death is 14 days,
are buoyed by a Federal Reserve willing to buy cantly for companies in the infrastructure construction space and continues to do so. Quite
and you can be in the hospital for three to six
the corporate debt of public companies.
weeks if you recover from severe symptoms.
The action of Congress and the progression sadly, however, the number of both Chapter 7
and Chapter 11 bankruptcies rose as a result
Another number is coronavirus hospitalof coronavirus are the two primary factors in
of coronavirus inactivity and low oil prices.
izations. In the United States this number is
whether we continue to return to valuations
We anticipate that as companies become
about 228,000, as of June 18, and represents
at the beginning of the year, or if the "V"
increasingly cash-poor due to the coronavirus,
the highest level since March. Time of stay
becomes a "W".
those with significant exposure to oil and gas
also makes this a lagging indicator, but spikes
Second-quarter 2020 deal activity
markets will continue to be impacted. *
in new hospitalizations have been on the rise
(FIGURE 4) was largely by companies that
since May 26 and are the reason for uncertain- were almost able to complete the required dilDAN SHUMATE is managing director with
ty as we begin to get back to "normal." We are
igence before the shutdowns put acquisitions
FMI Capital Advisors. He focuses on mergers and
not out of the woods yet.
on pause. The most notable of these was entry
acquisitions and business continuity transactions
Presented below is performance of the
of a new private equity, Calera Capital, into the in the utility transmission and distribution sector.
sector's publicly traded stocks year-to-date
(FIGURE 2) and the past three months
FIGURE 4: Recent Deal Activity
(FIGURE 3). Year-to-date performance shows
Announced
Target
Acquirer
Business Description
the significantly greater impact the twopronged attack of oil and coronavirus has had
Apr 2020
Diamond Contracting Corp Industry Mgmt Team
Wet utility pipelines
on the construction industry. March 18, 2020
Mar 2020
Thayer Power &
Calera Capital
Power and communication
was the low point, representing a 54 percent
Communication
distribution services
decline from the beginning of the year.
Mar 2020
City Light & Power
Amber Infrastructure
Power infrastructure owner and
Because of the federal reserve and conmaintenance company
Bore_Spacer-Ad_UC_2020.pdf 1 2/24/2020 10:40:27 AM
gressional actions, FIGURE 3 illustrates the

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Underground Construction - July 2020

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