Commercial and Residential HVAC Business
Industry
Location
Business Broker
Situation
Established in 1989, this successful, family-owned commercial and residential HVAC company had six family members actively involved in the business when the current owners, two brothers, sought to retire.
Their accountant introduced them to a corporate attorney to handle the legal matters related to selling the business. This attorney then introduced them to Business Brokerage Advisor, Molly Hanson of BayState Business Brokers.
Molly met with the brothers, one who led the construction side of the business and the other who ran service, along with their wives who also worked in the business to learn more about the business and their goals for the sale. She was impressed with its operations and was pleasantly surprised to learn the company had attained its revenue level by word-of-mouth, not even having a website.
BayState Business Brokers’ Approach
Molly saw great opportunity for a strategic buyer as this business had a strong trajectory of growth, having built a solid and loyal customer base over the years including general contractors for the commercial side of its business. Its financials were clean and employees were cross-trained.
Molly cast a wide net identifying qualified buyers as she took the business to market without disclosing a sale price. As a non-union HVAC business, the listing attracted a lot of interest among both individual buyers and strategic buyers.
Molly spearheaded the competitive process to evaluate all interested prospective buyers. Ultimately, two finalists were identified. The selected buyer had relevant acquisition experience and this acquisition gave him complementary geographic opportunities for continued growth.
There were many operational and technological efficiencies for this buyer to take advantage of, including a well-maintained fleet of vehicles. While not typical, the buyer investigated securing SBA financing and general commercial financing in parallel. Though this took more of his time and energy, it proved to be a wise approach as he had a ‘Financing Plan B’ in place when needed.
Results
Molly was able to successfully broker the sale so that all six family members affected by the sale of the commercial and residential HVAC business were happy. Both brothers and their wives had terms unique to the individual including non-solicit, non-compete and transition timeframe terms.
The brothers and their wives will be able to retire, satisfied with the sale price proceeds and their terms, while their sons chose to stay in the business. The buyer acquired a commercial and residential HVAC business that presented great opportunities for growth and operational efficiencies that complemented his existing HVAC businesses.
