INNOVATE Completes Sale of DBM Global to IES Holdings

All net transaction proceeds are intended to reduce INNOVATE’s outstanding debt, while part of the consideration remains in IES shares.

Rhea-AI Summary

INNOVATE (VATE) completed the sale of its approximately 91.21% stake in DBM Global to IES Holdings (IESC).

IES acquired all outstanding DBM Global common shares. INNOVATE and DBM Global Intermediate Holdco, together the Seller, received approximately $378 million in cash and 430,974 IES shares, valued at approximately $146 million using the October 2, 2026 closing price. A further $35 million cash payment compensated Seller for costs and obligations connected with a joint tax election, bringing total closing cash to approximately $413 million.

The purchase price remains subject to post-closing finalization. The IES shares carry a maximum 60-day lock-up following closing, subject to agreement terms. INNOVATE intends to use all net transaction proceeds to reduce outstanding debt.

5 points · 1 major

PositiveiHow this balance works

How this balance works

Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.

It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.

Rhea-AI Sentiment measures something else, the tone of the wording.

How the balance worksHow Sentiment works

0 major · 3 points

Hollow bars mark forward-looking points. How the balance works

Positive

• Major pointCompleted sale transfers INNOVATE’s approximately 91.21% stake in DBM Global to IES.
• Moderate point. Forward-looking: it has not happened yet and may not happen.INNOVATE intends to use all net proceeds to reduce outstanding debt.
• Minor pointSeller received approximately $378 million in cash at closing, subject to post-closing adjustments.
• Minor pointSeller received 430,974 IES shares, valued at approximately $146 million using the October 2, 2026 closing price.
• Minor pointSeller received $35 million in cash as compensation for joint tax-election costs and obligations.

Negative

• Minor pointPurchase price finalization remains pending a post-closing statement and, if necessary, independent accounting resolution.
• Minor pointIES stock consideration carries a maximum 60-day lock-up following closing, subject to agreement terms.
• Minor pointSeller bears costs and obligations connected with the joint Section 338 tax election.

Key Figures

Total cash received: approximately $413 million IES stock consideration: 430,974 shares; approximately $146 million Tax-election payment: $35 million +2 more

Total cash received

approximately $413 million

At closing, including the Section 338 tax-election payment

IES stock consideration

430,974 shares; approximately $146 million

Value based on IES's October 2, 2026 closing price

Tax-election payment

$35 million

Cash received at closing for costs and obligations related to the joint tax election

DBMG shares acquired

100%

IES acquired all outstanding DBMG common shares

Stock consideration lock-up

maximum 60 days

Following closing, subject to the Agreement

Historical Context

1 past event · Latest: Aug 10

1 event

1. Aug 10

   DBMG sale agreement

   24h Move

   -41.1%

   Prior agreement set a $650 million base price and stated proceeds would reduce debt.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

working capital, pro rata, lock-up period, section 338 tax election

4 terms

working capital financial

"based on estimates of cash, working capital, indebtedness and transaction expenses"

Working capital is the money a business has available to cover its daily expenses, like paying bills and buying supplies. It’s like the cash in your wallet that helps you handle everyday costs; having enough ensures the business can operate smoothly without running into money shortages.

View in glossary

pro rata financial

"Seller’s approximately 91.21% pro rata share of the base purchase price"

Pro rata means dividing or distributing something proportionally based on a specific factor, such as ownership or contribution. For example, if an investor owns 10% of a company, they would receive 10% of any dividends or benefits allocated. This approach ensures everyone gets their fair share relative to their stake or input, helping investors understand how benefits, costs, or responsibilities are fairly shared.

lock-up period financial

"subject to a maximum 60-day lock-up period following the closing"

A lock-up period is a fixed time after a stock offering during which company insiders and early investors are legally barred from selling their shares. It matters because when that restriction expires a large block of previously locked-up shares can enter the market at once, potentially lowering the stock price or spiking trading volume—like opening a floodgate—so investors monitor these dates to anticipate price moves and manage risk.

View in glossary

section 338 tax election regulatory

"in connection with the joint tax election under Section 338 of the Internal"

A Section 338 tax election is a choice, allowed by the U.S. Internal Revenue Code, that lets a buyer treat a purchase of a corporation’s stock as if it were a purchase of the corporation’s assets for federal income tax purposes. Making the election causes the target corporation to be treated as having sold its assets at fair market value (creating a stepped‑up tax basis in those assets for the buyer and potential taxable gain or loss in the target), while for legal and ownership purposes the transaction remains a stock sale; the election must be made according to IRS timing and eligibility rules and can change or eliminate certain preexisting tax attributes of the target (for example, some loss carryforwards).

AI-generated analysis. How Rhea-AI works. Not financial advice.

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NEW YORK, Oct. 05, 2026 (GLOBE NEWSWIRE) -- INNOVATE CORP.^® (NYSE: VATE) (“INNOVATE”) announced today that it has completed the previously announced sale of DBM Global, Inc. (“DBMG”) to IES Holdings, Inc. (Nasdaq: IESC) (“IES”) pursuant to the Transaction Agreement (the “Agreement”) announced on August 10, 2026 (the “Transaction”).

“Closing this transaction is a significant milestone for INNOVATE,” said Paul Voigt, Interim CEO of INNOVATE. “With these proceeds, we are substantially reducing our debt and strengthening INNOVATE’s balance sheet, which improves our financial flexibility as we focus on our remaining businesses. We want to thank Rustin Roach and his world-class team for their years of dedicated service and the tremendous value they have built. We wish Rustin and the team continued success as part of IES. INNOVATE’s remaining businesses are well positioned in attractive end markets, and we remain focused on executing our strategy, enhancing shareholder value and building on this momentum.”

Transaction Details

Under the terms of the Agreement, IES has acquired 100% of the outstanding shares of DBMG common stock — including approximately 91.21% previously held by INNOVATE (through DBM Global Intermediate Holdco Inc.) and the remaining approximately 8.79% previously held by other DBMG stockholders.

Consideration received by INNOVATE and DBM Global Intermediate Holdco Inc. (together, “Seller”) consisted of Seller’s approximately 91.21% pro rata share of the base purchase price, as adjusted at closing based on estimates of cash, working capital, indebtedness and transaction expenses of DBMG and certain additional adjustments as set forth in the Agreement. The purchase price remains subject to finalization following delivery of a post-closing statement and, if necessary, resolution of any disputes through an independent accounting firm. At closing, Seller received (subject to post-closing adjustments):

• approximately $378 million in cash, representing Seller’s portion of the $510 million cash consideration after giving effect to Seller’s receipt of 100% of the IES common stock issued as part of the total consideration and closing adjustments; and
• 430,974 shares of IES common stock (as adjusted for IES’s two-for-one stock split effected on August 21, 2026), valued at approximately $146 million based on the closing price of IES common stock on October 2, 2026.
  
  

The stock consideration is subject to a maximum 60-day lock-up period following the closing of the Transaction, subject to terms of the Agreement.

Each of the other DBMG stockholders will be entitled to receive its pro rata share of the base purchase price, subject to customary adjustments, entirely in cash.

In addition, Seller received $35 million in cash at closing as compensation for costs and obligations to be borne by Seller in connection with the joint tax election under Section 338 of the Internal Revenue Code being made with respect to the Transaction. Including this payment, Seller received total cash of approximately $413 million at closing.

Use of Proceeds

INNOVATE intends to use all net proceeds from the Transaction to reduce its outstanding debt.

For more information, please refer to the Current Report on Form 8-K to be filed by INNOVATE with the U.S. Securities and Exchange Commission (the “SEC”) in connection with the completion of the Transaction.

You may obtain copies of all documents filed by INNOVATE with the SEC regarding this transaction, free of charge, at the SEC’s website, www.sec.gov or from INNOVATE’s website at https://www.innovate-ir.com/.

Advisors

Cleary Gottlieb Steen & Hamilton LLP served as legal advisor to INNOVATE in connection with the Transaction. Jefferies served as financial advisor to INNOVATE.

About INNOVATE

INNOVATE is a holding company that owns, operates and invests in a portfolio of best-in-class businesses in the Life Sciences and Spectrum markets. INNOVATE is focused on maximizing value through disciplined capital allocation, strategic oversight and operational support of its subsidiaries. For more information, please visit: http://www.innovatecorp.com.

Forward-Looking Statements

Certain statements in this press release may constitute “forward-looking statements” within the meaning of the federal securities laws. Forward-looking statements generally relate to future events, including statements regarding post-closing adjustments to the purchase price under the Agreement; the value of the IES common stock received by INNOVATE and INNOVATE’s plans with respect to such stock; INNOVATE’s intended use of the net proceeds of the Transaction and its expected levels of indebtedness; and INNOVATE’s strategies with respect to its capital structure and its remaining businesses. You are cautioned that such statements are not guarantees of future performance and that INNOVATE’s actual results may differ materially from those set forth in the forward-looking statements. All of these forward-looking statements are subject to risks and uncertainties that may change at any time. Factors that could cause INNOVATE’s actual results to differ materially from these forward-looking statements include, but are not limited to (i) the outcome of post-closing purchase price adjustments, including any resolution of disputes under the Agreement; (ii) fluctuations in the market price of IES common stock, including during the lock-up period; (iii) INNOVATE’s ability to complete planned debt repayments on anticipated terms and timing; (iv) the performance of INNOVATE’s remaining businesses following the Transaction; (v) macroeconomic conditions; and (vi) the other factors under the heading “Risk Factors” set forth in INNOVATE’s Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q, which are available on INNOVATE’s website or at www.sec.gov. You should not place undue reliance on these forward-looking statements, which are made only as of the date of this press release. INNOVATE undertakes no obligation to publicly update or revise forward-looking statements to reflect subsequent developments, events, or circumstances, except as may be required under applicable securities laws.

INNOVATE Investor Contact:
Solebury Strategic Communications
Jenna Kozlowski
(212) 235-2691
Email: ir@innovatecorp.com

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What did INNOVATE receive from the DBM Global sale to IES?

INNOVATE and DBM Global Intermediate Holdco together received approximately $413 million in total closing cash and 430,974 IES shares, subject to post-closing adjustments. The shares were valued at approximately $146 million using IES’s October 2, 2026 closing price. Total cash includes $35 million compensating Seller for joint tax-election costs and obligations.

How does INNOVATE plan to use the DBM Global sale proceeds?

INNOVATE intends to use all net proceeds from the transaction to reduce its outstanding debt.

How are other DBM Global shareholders paid in the IES acquisition?

The other DBM Global shareholders are entitled to their pro rata share of the base purchase price entirely in cash, subject to customary adjustments. They previously held approximately 8.79% of DBM Global’s outstanding common shares.