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Cardinal Infrastructure expands into Florida with Hughes Brothers acquisition

Cardinal Infrastructure expands into Florida with Hughes Brothers acquisition

Money Moves

The Raleigh contractor switched to a 60% cash, 40% stock split and lifted the deal's maximum payout to $520 million.

October 19th, 2026: Payment mix revised toward cash

Overview

Updated Nov 1

Cardinal Infrastructure Group agreed on October 13 to buy Hughes Brothers Construction of Wildwood, Florida, for $357.5 million. On October 19 the Raleigh contractor changed how it will pay: 60% cash and 40% stock, up from an even split. Sellers get about $214.5 million in cash and 5,255,420 shares priced at $27.21 each.

The revision raises the most Cardinal could pay to $520 million, assuming Hughes Brothers hits earnout targets, from $455 million before. Hughes Brothers has more than 500 employees and about $350 million of contracted work. Cardinal's shares remain more than 80% below their June peak.

Why it matters

Infrastructure construction is consolidating into fewer, larger firms; this deal shows how regional contractors are being folded into national platforms.

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Key Indicators

$357.5M
Initial purchase price
Payable 60% in cash and 40% in Cardinal Class A stock under the amended October 19 terms.
$520M
Maximum deal value
Purchase price plus an earnout of up to $162.5 million tied to Hughes Brothers' profitability.
$350M
Hughes Brothers backlog
Work under contract at the time of the announcement.
80%+
Cardinal share decline since June 30
Stock fell from a June peak of $95.74 per share.

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People Involved

Jeremy Spivey
Jeremy Spivey
Chief Executive Officer, Cardinal Infrastructure Group
Leading Cardinal's acquisition program
MR
Mike Rowe
Chief Financial Officer, Cardinal Infrastructure Group
Structuring deal financing
 Chad Hughes
Chad Hughes
Co-founder and President, Hughes Brothers Construction
Will remain president after acquisition closes
JH
Justin Hughes
Co-founder and Vice President, Hughes Brothers Construction
Will remain vice president after acquisition closes

Organizations Involved

Cardinal Infrastructure Group
Cardinal Infrastructure Group
Publicly traded heavy civil contractor
Buyer; amended the Hughes Brothers terms on October 19, 2026

Raleigh-based heavy civil and site-development contractor that went public in December 2025 and has made ten acquisitions since 2021.
Hughes Brothers Construction
Hughes Brothers Construction
Heavy civil contractor
Acquisition target; terms amended October 19, 2026

Wildwood, Florida contractor specializing in underground utilities, earthwork, grading, roadways, and site development.

Timeline

December 2025 October 2026

8 events Latest: October 19th, 2026 · 3 weeks ago
Tap a bar to jump to that date

  1. Payment mix revised toward cash

    Latest Acquisition

    Cardinal amends the Hughes Brothers agreement to 60% cash and 40% stock and lifts the earnout ceiling to $162.5 million, taking the maximum deal value to $520 million.

  2. ENR analyzes the deal

    Reporting

    ENR reports Cardinal will use Hughes Brothers as a base for more Florida deals.

  3. Hughes Brothers deal announced

    Acquisition

    Cardinal agrees to buy Hughes Brothers Construction; the deal's maximum value was put at about $455 million before the terms were amended.

  4. Allied Paving deal closes

    Acquisition

    Cardinal completes its purchase of Allied Paving Contractors.

  5. Shares peak at $95.74

    Market

    Cardinal stock reaches its high before beginning a sharp decline.

  6. A.L. Grading acquisition

    Acquisition

    Cardinal acquires Georgia-based A.L. Grading Contractors, its first deal of 2026.

  7. Piedmont Pipe acquisition

    Acquisition

    Cardinal acquires Piedmont Pipe Construction in North Carolina.

  8. Cardinal goes public

    IPO

    Cardinal Infrastructure Group lists on Nasdaq at $23 per share.

Scenarios

1

Cardinal completes Hughes Brothers acquisition in Q4

Likely Resolves by Jan 15, 2027

Discussed by: ENR; Cardinal's announcement and investor call

The deal closes in the fourth quarter of 2026 as scheduled. Regulatory approvals and closing conditions are met. Cardinal adds construction services to Hughes Brothers, keeps the co-founders in place, and begins pursuing smaller acquisitions around the Central Florida operation.

2

Hughes Brothers deal renegotiated or terminated

Possible Resolves by Q1 2027

Discussed by: Business North Carolina, citing investor concerns about dealmaking pace

The stock's 80% decline makes the equity portion of the consideration less attractive to Hughes Brothers' sellers. Financing for the $156 million in new debt becomes harder to arrange. The deal is renegotiated at a lower price or falls apart.

3

Deal closes but integration drags on margins

Possible Resolves by May 15, 2027

Discussed by: Stifel analyst Brian Brophy's questions on residential exposure; Business North Carolina

The deal closes, but integrating Hughes Brothers' 500 employees and equipment fleet raises costs. Cardinal's adjusted EBITDA margin, already at 12.4% in Q2 against a 16-18% guidance range, stays below target through Q1 2027.

Historical Context

2 moments from history that rhyme with this story — and how they unfolded.

1997-2010s

Quanta Services builds a national platform (1997-2010s)

Quanta Services started as a small electrical contractor and grew through continuous acquisitions into the largest specialty infrastructure contractor in North America. It bought regional power, gas, and telecom contractors and folded them into a national network.

Then

Gave construction a template for consolidating fragmented specialty trades.

Now

Showed that a rollup can work when integration is disciplined and cross-selling follows.

Why this matters now

Cardinal is pursuing the same strategy in heavy civil, buying regional contractors and adding services to build a Southeast platform.

2021-2022

The 2021-2022 SPAC rollup slide

Dozens of companies went public through SPAC mergers promising acquisition-fueled growth. When execution lagged and interest rates climbed, many saw share prices fall 70-90% as investors questioned the pace of deals.

Then

Burned investor trust in acquisition-heavy public companies.

Now

Created lasting skepticism of companies that grow mainly through mergers and acquisitions.

Why this matters now

Cardinal's shares fell more than 80% from a June peak, echoing the pattern where market enthusiasm overruns fundamentals.

Sources

(10)
+4
Engineering News-Record Business North Carolina Seeking Alpha Law360 StockTitan Cardinal Infrastructure Group U.S. Securities and Exchange Commission PR Newswire RTTNews Underground Construction