Kraken Robotics (PNG) investor relations material

Deal rationale and strategic fit

• Combines two leading subsea technology providers to create a global supplier for maritime security, underwater infrastructure inspection, and dual-use subsea technology, expanding product offerings and total addressable market.

• Minimal product overlap and complementary products enable significant value creation, cross-selling, and deeper customer relationships in defence and commercial markets.

• Expands technical capabilities, production capacity, and geographic reach, supported by experienced engineering teams and advanced facilities.

• Strengthens competitive position, unlocks new growth potential, and improves business diversification.

• Aligns with corporate and M&A strategy to enhance technical capabilities, customer offerings, and financial position.

Financial terms and conditions

• Purchase price of $615 million (CAD 615 million), representing 9.7x expected 2025 adjusted EBITDA, with $480 million in cash and $135 million in equity to the seller.

• Funded by $150 million credit facility, $350 million public offering, and equity issued to Covelya shareholders.

• Seller to own approximately 4% of the pro-forma company post-transaction, with shares subject to a lock-up agreement.

• Combined company expected to generate ~$365 million revenue and ~$88 million adjusted EBITDA in 2025, with a 24% EBITDA margin.

• Expected leverage ratio of 0.8x adjusted EBITDA at closing, with improvement anticipated through EBITDA growth and debt repayment.

Synergies and expected cost savings

• Immediate accretion to financial results, with low- to mid-double-digit EPS accretion in 2027 after cost synergies.

• ~$10 million in expected cost synergies within 24 months from supply chain, facilities, R&D, IT, and administrative optimization.

• Revenue synergies anticipated from cross-selling and integrated solutions, though not included in current projections.