SPZ released 1H25 results this morning which on balance were fine, a little weaker than I expected but largely due to operating losses in Denmark and Germany before those geographies scale up.

However what dominated the result and the conference call this morning was the acquisition of Peak Parking based in Texas for the measly sum of $56m. 8x forecast EBITDA is nothing to sneeze at either!

It is a step change from the previous acquisitions made by SPZ:

UK - NE Parking (517 manual sites) for $520k

UK - Enterprise Parking Solutions (68 ANPR sites) for $1.54m

Germany - ParkInnovation (46 manual sites) for $2m

UK - Local Parking Security (72 ANPR, 54 manual sites) for $5.8m

Of course everything is bigger in Texas, including acquisitions!

SPZ management has earned the benefit of the doubt and I'm sure the lofty multiple the business trades at made the decision to acquire an easier one. That said, there are things shareholders will need to keep an eye on because unlike the acquisitions above the integration of Peak won't be as simple.

The business doesn't operate with SPZ's traditional parking breach notice business model. They charge a management fee to customers to manage their complete parking solution including valet, event management and consulting services. SPZ disclosed 20 of Peak's existing 134 sites have already expressed a desire to implement breach notices in their existing parking solution so there should be some immediate synergies on that front.

However it requires a change to the Peak business model where currently customers pay for any capex installed on their sites (boom gates, ticketing machines, etc.). SPZ has seen great success with the no capex model for customer, installing their ANPR system for free but then collecting the full benefit of any parking breaches (the customer benefits from better turnover in their parking site). On the call, the SPZ CEO said there is no one in the US using that model and they will remain flexible and use the model that best suits the customer.

In the end it became clear that despite Peak not being a "plug and play" acquisition like others in the past, SPZ management are very excited for it as the business has grown very strongly over the last few years all organically with an entrepreneurial management team committed to staying on and driving that further. But realistically today's announcement is bigger than Peak, it is confirmation that SPZ is ready to take on the gigantic US market. It will be a challenge and we will have to wait and see whether the Peak acquisition was the right one but nonetheless it is exciting to see them attack the US opportunity.