Everus (ECG) Bets $295M On Modular Construction’s Future

On September 1, Everus Construction Group (NYSE: ECG ) completed a $295 million cash acquisition of Epsilon Industries, a maker of prefabricated mechanical and electrical systems with plants scattered across the US and Canada. Everus first disclosed the deal on July 31, and the closing lands only a month after the company posted a quarter in which revenue jumped by more than a third. Epsilon's off-site fabrication lines give Everus a faster way to build the data centers, factories, and hospitals reshaping its backlog.

Everus grew into this deal from a position of strength. Second quarter revenue climbed 33.7% to $1.23 billion, and diluted earnings per share rose 59.2% to $1.64, numbers that reflect more than accounting leverage. Backlog reached $4.55 billion, up 41% from the end of 2025 and up 52.8% from a year earlier, driven largely by the electrical and mechanical segment, where revenue rose 41.6%, and EBITDA jumped 71.6%. That segment's backlog alone hit $4.16 billion, fueled by project bookings that topped $2 billion in the quarter across data center, hospitality, and high-tech work.

Epsilon slots directly into that momentum. Its modular capabilities are meant to extend Everus's geographic reach and deepen its footprint in advanced manufacturing, healthcare, and data center work, the same markets already driving backlog higher. Keeping Epsilon's president, Chris Wiederick, and its existing leadership in place suggests Everus wants continuity rather than a disruptive overhaul. Management raised full-year guidance to $4.5 billion to $4.7 billion in revenue and $410 million to $425 million in EBITDA even before folding in Epsilon's contribution, which it plans to detail during third-quarter earnings.

The growth comes with strings attached. Everus paid for Epsilon with cash on hand plus new borrowings under its credit facilities, its second acquisition this year after buying SE&M Constructors in the second quarter. Running two integrations at once raises the odds that something slips, whether in cost synergies or in the customer relationships that made both targets attractive in the first place. Net leverage stood at a modest 0.3x as of June 30, but that figure predates the Epsilon borrowings, so the real post-deal leverage is not yet known.

Not every part of the business is firing evenly, either. Transmission and distribution revenue grew only 7.1% in the quarter, and its backlog of $388.4 million actually sat below the $410.1 million reported a year earlier, even as the electrical and mechanical segment surged. That leaves Everus increasingly dependent on data center and commercial construction spending staying strong, a concentration that could cut the other way if that end market cools. And with the full financial impact of Epsilon not landing in guidance until third quarter results, investors are being asked to price in a deal whose numbers are still incomplete.