A larger step into power networks

Renew Holdings, the AIM-listed engineering services group that maintains and renews UK infrastructure, announced on 28 October 2026 that its Subsidiary Excalon Holdings had acquired Porter Brothers Holdings, the parent of PBU (UK). (LSE:RNWH) PBU provides extra high voltage cabling and Directional Drilling services to the electricity distribution market. Total consideration is up to £50 million on a cash and Debt free basis.

It is the latest in a series of electricity-focused purchases, and it raises a straightforward question: what Renew is paying, and how the deal fits the Balance Sheet ahead of full-year results on 24 November 2026.

Renew operates through several independently branded subsidiaries in rail, infrastructure, energy, including wind and nuclear, and environmental markets. (LSE:RNWH) Its work is largely regulated, non-discretionary maintenance and renewal by a directly employed workforce, with long-term visibility of committed funding, the company says.

The terms in detail

Renew paid initial cash of £31.1 million, funded from existing banking facilities. (LSE:RNWH) The company said this was based on sustainable EBIT of £3.9 million and EBITDA of £5.5 million. A further £18.9 million may be paid over three years if the vendors meet specific profit targets.

On our calculation, the initial payment equals about 5.7 times the stated sustainable EBITDA and 8.0 times EBIT. (LSE:RNWH) If the full earn-out is paid, total consideration would be about 9.1 times EBITDA, although by then the profit base would, by definition, need to have grown. The board described the Acquisition as immediately Earnings enhancing.

How it fits the Excalon build-out

PBU joins Emerald Power, PWR-X and Electricity Distribution Engineering Services within Excalon Holdings. The last of these, acquired on 19 May 2026, cost up to £9.0 million, with £6.5 million paid initially against sustainable EBITDA of £650,000, or 10 times on our calculation. Renew says the combined businesses can now offer clients a turnkey service from design through delivery.

Management points to an estimated £50 billion to £60 billion of Investment committed across the RIIO-ED2 and ET3 regulatory periods for electricity distribution and transmission. That figure is the company's estimate of the addressable investment, not a measure of work Renew has secured. On our reading, the strategy is to capture more of each project by owning the specialist skills that would otherwise be subcontracted.

Balance sheet capacity

In its year-end trading update on 1 October 2026, Renew said it finished the year to 30 September with net cash ahead of market expectations, helped by a one-off insurance payment of about £6.9 million from the settlement of historical claims. The company-compiled consensus it cited was pre-IFRS 16 net cash of £6.3 million, alongside adjusted Revenue of £1,191.2 million and adjusted operating profit of £77.7 million. The actual year-end figures have not yet been published.

Because the £31.1 million initial payment was drawn from banking facilities, the group is likely, on our reading, to have moved from modest net cash towards net debt after the deal, depending on cash flows since September. Measured against the consensus operating profit, the resulting Leverage would appear moderate, but the preliminary results will give the real numbers.

Risks to weigh

Earn-out structures align vendors with performance but can create pressure around targets and add future cash calls. Integrating several acquisitions at once places demands on management, and energy network spending depends on regulatory decisions and client programme timing. Renew has said it continues to evaluate further acquisitions, so leverage could rise again.

What comes next

Preliminary results for the year to 30 September 2026 are due on 24 November. They should confirm year-end net cash, the record order book the company has flagged, and any Dividend proposal. The LSE delayed price for the 3 November 2026 session, was 1,060p.