Verbrec Limited (ASX: VBC) provides engineering, asset management, operations and maintenance, and training to the energy, mining, infrastructure and defence industries in Australia, New Zealand, PNG and the Pacific Islands. The company announced it has acquired Alliance Automation (Alliance), increasing the group’s automation, control, digital industry, machine learning and cyber security capability and expanding its client base. The consideration of $5.5m, on a trailing FY25 EBITDA multiple of 5.0x and an adjusted EBITDA multiple of 2.7x, appear to be very favourable and highly accretive acquisition terms, particularly given the FY25 revenue base of the business was $62.5m. The acquisition will be funded by a new $6.5m debt facility. The timing of the settlement has coincided with the settlement of the sale of VBC’s Competency Training business as announced recently in September, generating ~$11.2m in cash sale proceeds. We see the combination of these events as a step change in the VBC offering, resulting in a business with ~700 employees across 18 locations in Australia and New Zealand, and a vastly broadened service offering within the existing core industries in which VBC operates. We believe significant value can be unlocked from the Alliance business once under VBC control. The VBC management team has a recent history of improving business performance, having improved the VBC EBITDA margins from (0.6%) in FY23 to 9.2% in FY25. Both transactions settled in December 2025 and although FY26 can be considered a transition year we upgrade our FY27 and FY28 revenue forecasts by 47% and 46% and our EBITDA forecasts by 10% and 17% respectively, resulting in an increase in our DCF valuation from $0.34/share to $0.44/share, representing share price upside potential of 167%.