New Deals: An underground utility contractor, auto body and repair shop, and 3 other finds

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NEW DEALS

1/ Underground Utility Contractor

📍 Location: California
💰 Asking Price: $2,375,000
💼 EBITDA: $650,000
📊 Revenue: $2,500,000
📅 Established: 2012

💭 My 2 Cents: This company provides underground utility construction services for federal, state, and local government customers. I like their focus on government clients, as it can be very hard to get the certifications and approvals to work on these types of projects, and once you are a preferred contractor these relationships and contracts can be very sticky. I also like the steady growth in their revenues, seen in the $2.1M in contracted backlog they already have for 2025. I’d want to better understand the revenue breakdown between their different utility services, how they win new jobs (including what the bidding process looks like and what the owner’s role is in it), how far out their pipeline of future jobs normally is, and who their main competition is. Given their contracted backlog and demonstrated project expertise, this looks like a strong deal with a nice safety net of stable earnings. Note: With the government contracts in place and the certifications involved, you may need to pursue a stock purchase on this deal.

2/ Auto Body and Repair Shop

📍 Location: Ohio
💰 Asking Price: $3,200,000
💼 EBITDA: $800,000
📊 Revenue: $1,800,000
📅 Established: 1997

💭 My 2 Cents: When you think about services that will always be needed, auto body work and repair have to be on the list. This business operates from two locations, one responsible for body work and the other for mechanical repairs and used car sales. I really like their multiple revenue streams, high cash flow, and multi-month backlog of work at both shops. I also like how both locations use their specialized capabilities to help optimize their productivity. As a result, both locations can handle more business with an increase in staff. The real estate is listed for sale separately, which if you decide to pursue could increase the amortization of an SBA loan up to 25 years, thereby increasing post-debt-service cash flow. I’d also be curious as to how they acquire new customers, if they have an online presence (would check any reviews), how much competition they face in their local market, the qualifications and experience of their staff, and how reliant the business is on the owner (and whether there are shop managers in place). Their proven track record and growth potential should make this an enticing opportunity for someone looking to enter or expand in the industry.

3/ Fencing Company

📍 Location: Ohio
💰 Asking Price: $2,000,000
💼 EBITDA: $575,000
📊 Revenue: $3,900,000
📅 Established: 1994

💭 My 2 Cents: Fencing is your classic tried-and-true boring business. While there is a lot of competition in this space, I like how this company, in operation for over 30 years, has grown primarily through word-of-mouth, pointing to a stellar reputation in the community. A new owner with a growth mindset should be able to leverage this reputation to boost lead-generation efforts and drive increased business. I like how they are located in an area with ongoing development. However, I’d want to look into housing and population growth trends in the area as a potential indicator of how much new business will likely exist going forward. And especially since it’s a project-based business, I’d also want to review their financials to verify the consistency and stability of their revenue and earnings over the years. What’s nice about fencing businesses is their scalability through geographic expansion, which is why I’d want to dig into opportunities in surrounding areas. Finally, I’d want to get a handle on their work backlog, how much of their clientele is residential vs. commercial, what their supply chain looks like and whether there’s an opportunity to source directly from manufacturers to improve margins, and the nature and condition of the nearly $400K in FF&E included in the sale. 

4/ Electronics Recycling Business

📍 Location: Texas
💰 Asking Price: $3,800,000
💼 EBITDA: $777,948
📊 Revenue: $2,266,162
📅 Established: 2003

💭 My 2 Cents: Did you know that electronic waste is the largest waste stream on the planet, and the US market alone grew 8.5% per year on average between 2018 and 2023? This company specializes not just in electronics recycling and reselling, but also in the fast growing market of secure data construction. I like their diverse client base, which ranges from corporations to schools and municipalities. I like this business's stellar reputation, highly qualified team, impressive cash flow, and strong margins. They are also positioned for growth, as they are readily scalable with a well-equipped, ample facility that could handle a 100% increase in business. While the sale includes all the equipment needed to run the business, the real estate must be purchased separately. I’d need to check on the revenue split between their different services, the extent of their repeat business, who their key clients are, and any possible concentration issues. I’d also want to really understand the regulatory environment surrounding e-waste and secure data construction. Ultimately, the strong regulatory tailwinds make this a very interesting business to be in.

5/ Commercial Cleaning Business

📍 Location: Arizona
💰 Asking Price: $2,000,000
💼 EBITDA: $850,000
📊 Revenue: $10,500,000
📅 Established: N/A

💭 My 2 Cents: I really like commercial cleaning businesses because of their simple operations, steady contracts, and low overhead. This particular business provides cleaning services to dozens of resorts and restaurants across Arizona. They have a seemingly streamlined operation, as even though they are based in just a small 1,000 sq ft office, they employ some 250 subcontractors to do the actual cleaning work. I like their extensive client list, stable revenue, and high cash flow. I also like their scalability, as their use of subcontractors means that they can readily grow alongside the expanding Arizona tourism and hospitality market. With commercial cleaning businesses, quality of service is what differentiates a business, which is why I’d spend the majority of my time digging into what client retention looks like and how they train employees, retain subcontractors, and manage and maintain quality standards with such a large workforce. With established relationships with large clients across the state, this looks like a great boring business.