Description

Advanced Drainage Systems Acquisition: The StormTrap Synergies Investors Should Be Watching Closely!

Advanced Drainage Systems has moved to strengthen its position in stormwater management through its proposed acquisition of StormTrap Investments from PSP Capital for approximately $530 million, or about $450 million after adjusting for the present value of expected tax benefits. The transaction would add large-volume, space-constrained stormwater storage capabilities to a portfolio that already includes StormTech chambers, CULTEC products, Aquabox plastic crates, pipe, fittings, water-quality products and digital design tools. StormTrap generated approximately $165 million of revenue and $40 million of adjusted EBITDA during the 12 months ended July 2026, with the transaction implying an acquisition multiple of roughly 10x adjusted EBITDA including expected run-rate cost synergies. Management expects the deal to be accretive to adjusted EPS in the first year and plans to fund it through cash on hand and existing credit capacity. The acquisition is expected to close in the fourth quarter of 2026, subject to customary conditions.