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Blog/April 6, 2021

4 Factors Driving Value for HVACR Companies in 2021

Given the volatility we experienced in 2020, many mechanical, electrical, and HVACR firms are wondering what the M&A market is looking like in 2021. The short answer is: the market has actually increased and buyer demand remains at an all-time high.

Some of the biggest factors driving value for firms in this market are:

  • Amount of service-focused revenue
  • Size and scale
  • Margin profile
  • The next generation of talent

Why Consider Going to Market in 2021?

2021 is a great time to consider going to the market if you’ve been considering your ownership transfer needs for a few reasons. We’ve seen increased buyer demand, and the competitive nature of buyers trying to acquire in the space is driving values up. Values certainly are higher today than they were three to four years ago for companies in this space. Also, given the potential for tax changes in the near future, many owners are considering if it is in their financial interest to lock in a purchase price at today’s capital gains rate as opposed to rolling the dice in the future.
 
You may also be interested in Three Reasons HVACR Companies are Selling in 2021:

FMI-HVACR-video-article
 
How FMI Serves HVACR Companies

FMI Capital Advisors’ Contractor and Construction Services is a dedicated group specializing in M&A, capital formation, and ownership transition services for construction and construction-related service providers like those in the HVACR, plumbing, and other mechanical electrical system trades.
 

 

 

 

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