M&A activity ramp up in US HVAC-MEP Services

Transaction activity in the US HVAC-MEP services space accelerated in the second half of 2024 led by strategic buyers continuing the consolidation trend to scale operations and strengthen labor capacity across the U.S.

Market snapshot
• Sluggish deal activity in the first half of 2024 gave way to significantly greater transaction volumes, particularly in Q4 when deals increased c.50% supported by an improving inflation and interest rate backdrop
• In total, the sector saw 165 transactions in 2024, with a median target enterprise value of c$33m
• PE buyers dominated in the early part of 2024, but strategic buyer activity increased significantly later in the year, and by year end they represented 56% of the total deal volume
• Sector valuations for the most part remained within a narrow range, with average multiples between c.13.5x and c.14.7x
• With key comparable companies maintaining c.15%+ EBITDA margins and 15%+ 3 year revenue CAGRs during 2024, the sector continues to exhibit attractive operational dynamics for buyers

We would be delighted to discuss in more detail your M&A plans, these insights and the sector more broadly.