Electrical Contracting Business

by a searcher from Columbia University - Columbia Business School

3 years ago

Hi all, I have identified a target in the electrical contracting business ($6M revenue) and in preliminary discussion, moving to an LOI. Would be great to connect with anyone who knows this space as operators. Does the license reside with the business or individual? I am a self funded searcher but interested in interest equity partners or bank lending. Thanks.

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searcher from Massachusetts Institute of Technology - MIT Sloan School of Management

I don't know if you've acquired or are still looking at electrical contracting, but if you are, I've learned a bit about it as I'm searching in home services. Feel free to email me at --@----.com

3 years ago | like reply | 0 likes

searcher from Texas A&M University

I looked at several electrical contractors early in my search. In most states the business is required to operate under the license of an individual Master Electrician. Typically this individual is the owner, but it could also be a key employee. If the license holder isn’t the owner you will have to pay that person very well because their license (and livelihood) is on the line if there is ever an issue. I also found it very difficult to secure debt financing for smaller licensed contractor businesses. SBA is normally not an option unless you happen to already hold the relevant license. If it’s a larger target ($2m+ EBITDA) with multiple license holders as foremen this may be less of an issue.

3 years ago | like reply | 1 like

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