$900k Revenue B2B Electrical Contractor SE MN

Description

Electrical contracting company for sale in Southeastern Minnesota with nearly 20 years of operating history. The business focuses primarily on commercial and industrial electrical work, with residential projects representing a small portion of total activity.

Financial profile

• Annual revenue: approximately $1,000,000
• Seller-reported SDE margin: approximately 36%
• Seller-reported EBITDA margin: approximately 25%
• Residential work: approximately 5% or less of total business
• Commercial and industrial projects generate the majority of revenue

The seller reports that gross margins have improved over time. Buyers should review tax returns, project-level job costing and normalization adjustments used to calculate both SDE and EBITDA.

Customer base

The company works with manufacturers, industrial facilities and other commercial customers throughout the region. Several customer relationships have been developed over multiple years.

A buyer should review revenue concentration by customer, recurring maintenance work, open contracts and the amount of revenue tied to individual industrial accounts.

Team

The operation is supported by experienced electrical personnel, including employees holding Master and Journeyman electrical licenses.

The availability and continued employment of licensed staff will be important to maintaining current project capacity following a sale.

Current demand

The seller reports that project inquiries currently exceed available labor capacity and that some work is being declined because of staffing limitations.

Adding qualified electricians could allow the company to accept more of its existing commercial and industrial demand without materially changing its current market focus.

Growth

• Hire additional licensed electricians
• Take on more existing commercial inquiries
• Expand industrial maintenance and service work
• Develop additional manufacturing accounts
• Increase the residential portion of the business if desired

Capital requirements

The seller represents that only limited additional capital expenditure is required to maintain current operations. Buyers should confirm the age and condition of service vehicles, tools, testing equipment and any other major assets before relying on that assessment.

Due diligence

Buyers should verify historical financials, customer concentration, backlog, work in progress, accounts receivable, project margins, employee compensation, licensing coverage, vehicle and equipment ownership, insurance, bonding requirements and any outstanding warranty or project obligations.

Electrical contractor and individual electrician licenses may be subject to Minnesota state and local requirements and should not be assumed to transfer automatically with the business.