Bhagwan Marine Ltd has announced a transformative $120 million acquisition of Riverside Marine Holdings, significantly enhancing its scale, profitability, and market reach. The deal is expected to lift FY26 revenue to $346 million and deliver a 14% EPS accretion.
- Acquisition valued at $120 million with $70 million debt funding
- Pro forma FY26 revenue rises to $346.3 million
- EBITDA margin expands from 18% to 24%
- EPS accretion of approximately 14% forecast for FY26
- Riverside’s capital-light model and diversified services complement Bhagwan
A Strategic Leap for Bhagwan Marine
Bhagwan Marine Ltd has unveiled a significant acquisition of Riverside Marine Holdings Pty Ltd for $120 million, marking a pivotal expansion in its maritime services portfolio. Expected to complete by the end of March 2026, the transaction is set to elevate Bhagwan’s pro forma FY26 revenue to $346.3 million, with EBITDA margins improving markedly from 18% to 24%.
This deal is not just about scale but strategic alignment. Riverside, a near-century-old Brisbane-based operator, brings a diversified fleet of approximately 30 vessels and a strong foothold across multiple maritime sectors including vessel management, dredging, and ferry operations. Its capital-light business model and long-term contracts with tier-one customers dovetail neatly with Bhagwan’s growth ambitions and operational ethos.
Financial Upside and Operational Synergies
Financially, the acquisition is expected to be accretive, delivering around 14% earnings per share (EPS) growth and over 20% return on equity accretion in FY26. Riverside’s forecast EBITDA of $26.2 million, representing a robust 41.3% margin, will contribute to a combined EBITDA uplift to $77.2 million. The transaction is funded through a blend of a $70 million debt facility, $20 million in vendor shares, and a $30 million institutional placement, reflecting a balanced capital structure designed to sustain growth while managing leverage.
Beyond the numbers, the acquisition offers Bhagwan enhanced diversification by service type, geography, and commodity exposure. Riverside’s operations span critical regions such as Brisbane, Townsville, and the Pilbara, servicing sectors from industrial resources to scientific research and transport logistics. This geographic and sectoral spread mitigates risk and opens avenues for cross-selling and operational efficiencies.
Cultural and Strategic Fit
The cultural fit is equally compelling. Riverside’s safety-first, quality-focused culture and experienced multi-generational management team resonate with Bhagwan’s values. The acquisition also brings a high proportion of repeatable revenue, expected to increase Bhagwan’s from about 40% to 50%, providing greater earnings visibility and stability.
Investor confidence is further supported by the structured earnout mechanism, which incentivises performance with up to $10 million additional consideration if Riverside meets EBITDA targets. Shareholder approval is pending for part of the placement and vendor shares issuance, with the company’s directors also participating in the capital raise, signalling strong internal conviction.
Looking Ahead
As Bhagwan integrates Riverside’s operations, the market will be watching closely for the realisation of anticipated synergies and the company’s ability to leverage its expanded fleet and expertise. The acquisition positions Bhagwan as a more diversified and resilient player in the Australian maritime services sector, with a promising outlook bolstered by upcoming infrastructure projects and sustained demand across its end markets.
Bottom Line?
Bhagwan’s Riverside acquisition sets the stage for stronger earnings and market leadership, but execution risks remain as integration unfolds.
Questions in the middle?
- How will Bhagwan manage integration risks and realise projected synergies?
- What impact will the increased debt have on Bhagwan’s financial flexibility?
- How dependent is the earnout on Riverside’s FY26 EBITDA performance amid market uncertainties?