Equity Gap for 4x EBITDA Commercial HVAC Deal in Canada

We are purchasing a 21-year-old commercial HVAC supplier & installer in Prince Edward Island, Canada for $2.7M (3.8x adj. EBITDA). Investment Highlights:
1/ Industry with tailwinds as demand for HVAC products & services is expected to be robust trending in line with population & GDP growth in PEI 2/ Stable, profitable & long-standing business operating for over 21 years. CAD 4.6 million revenue. CAD 0.7 million EBITDA. 15%+ profit margins. 3/ Easy-to-manage B2B services model with low-capex 4/ 100+ re-occurring customers with 76%+ of revenue coming from repeat customers active in at least 2 of the last 3 years. 5/ Diversified revenue base with exposure to multiple end-markets and the largest customer accounting for 13-17% of revenue 6/ Competitively positioned to win bids due to Daikin Authorization 7/ Strong future revenue visibility with order backlog (as of October 1, 2024) standing at CAD 5.7 million. 8/ Management continuity as the main seller-manager will stay on and have equity in the business.

Equity Overview

1/ Equity Gap: CAD 250,000 (CAD 550,000 of Equity already available)

2/ Minimum check size: CAD 35,000

3/ 10% Preferred return, 2.8x step-up

4/ Base case investor returns with 0% growth, no margin expansion & no multiple expansion: 30%!

Next Steps

If you would like to explore this opportunity further, please comment below, or feel free to pick a suitable time from the calendar here for an intro call: https://calendly.com/nvc-nitin/

We look forward to hearing from you and exploring a partnership!