BAM agrees €504m underground infrastructure acquisition

Royal BAM Group has agreed to acquire Dutch underground infrastructure specialist A.Hak at an enterprise value of €504 million, adding expertise in pipelines, cable installation and trenchless construction to its existing civil engineering activities if the transaction completes. A.Hak already operates in the UK as well as the Netherlands and Belgium, and BAM has identified opportunities to expand that presence alongside its established British construction business.

Completion is expected in the first quarter of 2027, subject to regulatory approvals, employee consultation and other customary conditions. Until those requirements are met, A.Hak remains an independent contractor; BAM’s intention is to retain the acquired company’s name, management and established customer relationships after closing. BAM identified no specific new British construction contract when it confirmed the proposed acquisition on 8 October 2026.

A.Hak employs approximately 900 full-time staff and has worked in underground infrastructure for more than 60 years, undertaking electricity, gas, water and heat network projects. Its capabilities extend from distribution services to transmission pipelines and medium-voltage and high-voltage cable routes. With approximately 85% of revenue generated in the Netherlands, the existing businesses in Belgium and Britain provide a smaller international base from which BAM expects further development to be possible.

The specialist methods used by A.Hak allow utilities to install infrastructure beneath roads, railways, waterways and occupied land where a continuous open excavation would be disruptive. Such work still requires space for launching equipment, service connections and temporary works, and the route must be chosen against ground conditions, pipe diameter and nearby buried services. A trenchless installation can limit surface excavation along the crossing, while retaining substantial engineering requirements at its ends.

A.Hak’s trenchless work includes horizontal directional drilling, in which a bore is steered along an engineered alignment before a pipe or duct is installed through the prepared route. Accurate control of the drill path and knowledge of the ground are needed to avoid unsuitable strata and existing infrastructure. The size of the product, length of the crossing and available working space affect the approach, with subsequent connection to the utility network requiring separate planning and execution.

Where the project conditions permit, Direct Pipe technology offers a different installation sequence by advancing a cutting head through the ground as a connected pipeline is pushed forward from the launch area. The approach combines aspects of microtunnelling and pipe installation, potentially avoiding a separate pulling operation through a completed bore. Its suitability depends on the alignment, ground conditions and loads imposed on both the pipe and the installation equipment; no particular technique has been specified for a new UK project arising from this proposed acquisition.

On power cable projects, the civil works must accommodate electrical network requirements as well as the excavation or boring needed to establish an underground route. A route may need duct sections, jointing locations, protection at crossings and access for cable installation, while the network operator’s testing and commissioning programme determines when a completed connection can be energised. A constructed duct or excavated corridor consequently represents one part of delivery, with equipment installation and system checks still required before the network can use the new asset.

Those capabilities complement BAM’s existing civil engineering and energy distribution activities, which already involve infrastructure owners and utilities across its operating markets. According to BAM, more than half of A.Hak’s revenue comes through long-term frameworks, providing an established route for repeat work while individual projects continue to require defined scope and delivery arrangements. The acquisition could enable cooperation on suitable projects, but no additional UK award or delivery programme has been confirmed.

While A.Hak’s project portfolio covers utilities and underground construction, BAM’s €504 million enterprise valuation relates to the acquisition of the business itself. The group intends to finance the transaction using existing cash and a committed bridge facility from Rabobank, ING Bank and ABN AMRO. The valuation is separate from contract sums for pipelines, cables or other infrastructure work, which continue to be established by the relevant customers and project agreements.

BAM expects A.Hak to generate approximately €425 million in revenue for 2026, with an adjusted EBITDA margin of around 10%, and projects annual adjusted EBITDA of €65 million to €75 million in the medium term. The latter is a forecast, not an earnings result already achieved. BAM also cites approximately €1 billion of order backlog covering 2027 to 2031, with more than 75% of expected revenue over that period supported by existing contracts and anticipated renewals.

Contracts already awarded offer greater certainty than renewals awaiting customer decisions, particularly where work is commissioned as individual packages under continuing framework arrangements. BAM’s forward projections combine already awarded activity with expected renewals, leaving a portion of forecast revenue and earnings dependent on future customer decisions. The company’s wider case for the acquisition also reflects expected investment in electricity and water infrastructure rather than a guaranteed allocation of that expenditure to A.Hak.

In the Netherlands, electricity and gas network operators plan investment of approximately €235 billion between 2026 and 2040, according to BAM, alongside substantial requirements for water infrastructure. The planned work may involve underground cables, distribution pipelines and associated civil engineering in constrained routes. Such investment creates demand for specialist construction capability, although individual projects will still depend on utility procurement, design decisions and the award of contracts.

Expansion in Britain is another possibility because BAM already has a civil engineering operation there and A.Hak has a smaller existing presence in the market. Reinforcement of electricity networks and renewal of water infrastructure may offer opportunities to combine their experience after the deal closes. Neither company has attached a UK revenue target, new workforce commitment or named pipeline project to the acquisition, so the proposed commercial expansion remains an intention rather than an awarded programme.

Deployment of drilling teams and specialist equipment across the wider group will have to account for construction access, ground investigations, network outages and permissions from the relevant asset owners. Maintaining A.Hak’s separate management and customer relationships is BAM’s stated approach to preserving its operating model while making the larger organisation’s resources available where appropriate. Integration decisions and project responsibilities will follow the transaction rather than precede its regulatory completion.

BAM expects the acquisition to take energy transition activities to more than 20% of group revenue, a projection about its business mix rather than a measured environmental saving from particular installations. Subject to the remaining approvals and consultation, the first quarter of 2027 is the intended closing period, after which the companies can establish how to coordinate the specialist underground work across their markets.