Add-Type uses File.ReadAllText() API in a loop for reading in multiple source files. This can be non-performant for multiple reasons:
a. ReadAllText() uses a small buffer that increases IO calls.
b. It performs StringBuilder.ToString() internally which allocates a string that is not used, making possible LOH allocation and adding GC pressure.

Consider using a different pattern:

StringBuilder sourceCode = new StringBuilder();

foreach (string file in paths)
{
    foreach (string line in File.ReadAllLines(file))
    {
        sourceCode.AppendLine(line);
    }
}

String result = sourceCode.ToString();