Shoals Holders Would Get 1.6931 Array Shares Each, And Shoals' CEO Would Run The Merged Company
Shoals holders would own about 65% of the combined company in an all-stock deal, while Array's CEO steps aside at closing.
Array Technologies agreed Wednesday to merge with Shoals Technologies Group in an all-stock deal that gives each Shoals share 1.6931 Array shares. Shoals CEO Brandon Moss would become CEO of the combined company, and Array CEO Kevin Hostetler would leave the job and the board at closing.
Shoals holders take the majority
Array is the legal acquirer, and Shoals would survive as its wholly owned subsidiary. Shoals holders would own about 65% of the combined company's basic shares, or 64.5% fully diluted, with Array holders keeping roughly 35%, the companies said.
The companies targeted more than $100 million of annual adjusted EBITDA synergies within three years of closing, including about $20 million from year-one cost savings and about $15 million from year-one cross-selling. They gave a preliminary, indicative combined 2027 revenue range of $2.2 billion to $2.4 billion, which they said does not represent projections of either company.
Shoals shares traded at $8.96 in Wednesday trading, up 5.79% from the prior close of $8.47, for a market value of about $1.4 billion.
Two products on the same projects
Shoals, which designs and makes the electrical equipment that carries power from solar panels and batteries to inverters and the grid, sells mainly to firms building large solar and battery projects. Array supplies solar tracking and foundation systems, so the two companies' products are installed on the same sites.
The companies said only about 20% of projects they served in 2025 and 2026 used both firms' products, the gap behind the cross-selling case.
Both reported third-quarter results Wednesday. Shoals posted revenue of $195.3 million, up 43.8%. Array's revenue fell about 16% to $330.2 million, and it cut full-year guidance.
Board, breakup fees and preferred stock
The combined board would have ten directors: four independents from each side, Moss, and Brad Forth, who chairs both boards today, as chairman. Hostetler is expected to serve as a special advisor to help with the transition. The companies will agree on a new name and ticker, and headquarters would be in Albuquerque, New Mexico.
Array would owe Shoals a $40.3 million termination fee in specified cases, such as a board recommendation change. Shoals would owe Array $22.2 million in comparable cases.
Array also struck a deal with its preferred holders, Blackstone and VP Helios. It would redeem $150 million of Series A preferred at 93% of liquidation preference within 90 days of closing, then at least $50 million a year at 96% over three years, up to $150 million.
The companies expect to close in the first quarter of 2027, pending shareholder votes at both companies, expiry of the antitrust waiting period and Nasdaq listing approval, and they expect to file a joint proxy statement and Form S-4 by year-end.
Sources
- 425 — Array Technologies, Inc. re: Shoals Technologies Group, Inc. (SHLS) — SEC EDGAR
- Array Technologies, Shoals Technologies to merge in all-stock deal (ARRY:NASDAQ) | Seeking Alpha — seekingalpha.com
- Shoals Technologies Group (SHLS) Q3 Earnings and Revenues Top Estimates — Yahoo Finance
- Shoals Technologies: Q3 Earnings Snapshot | wusa9.com — Associated Press
- ARRAY Technologies Reports Financial Results for the Third — globenewswire.com
- Shoals Technologies Group, Inc. Reports Financial Results — globenewswire.com
