Contractor SRG Global swoops on Sydney utilities outfit with 750 staff for $111 million

SRG Global will pay $111 million to buy Sydney-based utilities infrastructure builder Diona as the contractor turns another profit and eyes further growth in water and energy transition markets. Among the raft of WA contractors delivering full-year results on Tuesday, SRG reported a $34.4 million net profit for 2024, buoyed by 32 per cent higher revenues of just over $1 billion. SRG noted earlier in the year that the company had a strong enough balance sheet to keep an eye on potential additions, which has been followed up by the acquisition of Diona, announced on Tuesday. The Subiaco-based engineering, maintenance and mining contractor will pay $111m for the Sydney-headquartered business, which builds pipelines and storage systems for water and gas networks, as well as upgrading electricity networks in most States outside of WA. He said acquiring Diona would add another $1b work of worth in water and servicing the energy transition. “On the energy transition space it’s the push to renewables, it’s modernising the network and energy security. The market’s moved to building things like data centres the reality is they need to be connected to the grid, and a lot of what Diona does is in-ground services connecting to the grid,” Mr Macgeorge said. The company’s last acquisition was an $80m deal to buy ALS’s asset maintenance business. SRG swooped to buy WBHO Infrastructure’s WA business from administration in 2022. Diona has about 750 staff and largely services government agencies and utilities. The additions would lift SRG’s staff to more than 4000. Broadly Mr Macgeorge was upbeat about the labour market and said that labour costs were still manageable. To fund the buy SRG is raising $60 million at 83¢ apiece via a fully-underwritten capital raising and a $6m share purchase plan. Bell Potter and Shaw & Partners were on the ticket for the raising. The rest of the deal be funded through new debt and existing cash. SRG has bumped up its earnings guidance to about $125m for FY25 and has about $3b worth of work in hand. “Diona is complementary to SRG Global’s service offering in highly attractive growth markets and geographic locations; and will further enhance our strong track record of cross-selling our end-to-end services,” Mr Macgeorge said. “SRG Global now has Work in Hand of $3b and is well positioned for long term sustainable growth with end-to-end asset life cycle capability in water, defence, resources, transport and energy transition sectors across Australia and New Zealand.” SRG shares last changed hands at 86¢.