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  • New Deals: An executive placement firm, glass and glazing business, and 3 other finds

New Deals: An executive placement firm, glass and glazing business, and 3 other finds

Plus, SMB M&A tax considerations to maximize cash flow in year 1

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Thanks for all the great feedback from the deals I shared on Tuesday!

I’m excited to share 5 new deals worth checking out.

Today's issue is sponsored by SMB Diligence, the platform I helped start for matching business buyers with vetted legal counsel and Quality of Earnings providers. 

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NEW DEALS

1/ Executive Placement Firm

📍 Location: Raleigh, North Carolina
💰 Asking Price: N/A
💼 EBITDA: $1,018,078
📊 Revenue: $2,998,568
📅 Established: 2002

💭 My 2 Cents: This company specializes in executive placement in industries like tax, finance, and marketing for clients nationwide. I like how they focus on filling high-level positions, as these can be much more lucrative than those handled by general staffing businesses. I also like their virtual business model which keeps their overhead low and makes them readily scalable without needing to incur upfront costs. I’d want to look into the consistency of their revenues and earnings over time, how they source their candidates and placement opportunities, who their key clients are and if there are any concentration issues, how they differentiate themselves from the competition, and what openings there might be to expand their services to other industries. I’d also want to understand how reliant the business is on the current owners. Assuming everything checks out, this company’s long history, established client base, and scalability make this an especially interesting opportunity.

2/ Glass and Glazing Business

📍 Location: New York
💰 Asking Price: $3,500,000
💼 EBITDA: $573,112
📊 Revenue: $5,560,887
📅 Established: N/A

💭 My 2 Cents: This company is a longstanding leader in its area for wholesale glass distribution and both commercial and residential glazing services. They have been in business an amazing 80+ years, so they should have both a stellar reputation and a strong loyal client base. I like how they are both a distributor and contractor, as this lets them stand out in their market while bringing in two separate but complementary revenue streams. The fact they can source their own materials also gives them greater control of their pricing and margins in their contractor work. Finally, I like that their long history makes it very straightforward to review and become comfortable with the stability and predictability of their earnings over time. I’d want to check on the revenue split between the two different sides of their business, the split between new installations (reliant on new construction) and replacements for their glazing business, how they acquire new contractor work, if they face material cost and supply chain issues, the qualifications and experience of the staff, and whether there's seasonality in the business since construction projects pick up in warmer months. There is always a demand for glass and glazing services because glass is prone to breakage, so this deal should work for someone seeking a steady cash producer.

3/ Commercial Electrical Contractor

📍 Location: Skagit County, Washington
💰 Asking Price: $2,600,000
💼 EBITDA: $740,000
📊 Revenue: $4,682,000
📅 Established: 1988

💭 My 2 Cents: Remember how miserable you were the last time the power went out? Yeah, now you know why electrical contracting is the very definition of an essential business. This particular contractor has over 30 years of experience in delivering complex projects across both public and private sectors. They hold SBA 8(a) and Minority Owned/Disadvantaged Business certifications, opening up significant federal contracting opportunities. Add to this that the business comes with experienced technicians in place and specialty vehicles and other equipment valued at $500K, and things look pretty good. However, I’d need to get a handle on their revenue breakdown between public and private projects, how much work is currently in progress or contracted backlog, how they win new business, and who their key competitors are. I’d also need to dig into the condition of the FF&E, the current utilization of their staff and equipment, and how much more work they could handle without adding new employees or assets. I’d also need to understand what would be involved in keeping or reacquiring their special certifications post-transition. These certifications, and the ability to capture federal contracts they represent, make this already solid boring business a very appealing option for someone looking to enter or expand in the space.

PRESENTED BY SMB DILIGENCE

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A friend of mine put a business under LOI and asked me for my advice.

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SMB Diligence is the platform I helped start for matching business buyers with vetted diligence providers, from M&A lawyers to Quality of Earnings providers.

Their network of experts has worked on hundreds of small business transactions (including many from the SMB Deal Hunter community).

4/ Steel Fabricator

📍 Location: Colorado
💰 Asking Price: $7,500,000
💼 EBITDA: $1,664,925
📊 Revenue: $10,276,886
📅 Established: N/A

💭 My 2 Cents: This well-established and highly profitable steel fabrication business produces both structural and ornamental steel and offers end-to-end services from estimation to field installation for a wide range of commercial and municipal clients. I really like how they are focused on keeping up with technological advances, investing $2.5M in new equipment and software in just the last five years alone, including a state-of-the-art robotic fabrication system. This investment is paying off, as they currently have over $6M in contracted backlog. Another huge plus is they come with $5M in FF&E and $2.1M in inventory, meaning that all the assets in the sale nearly equal the entire asking price. While this all looks great, I’d need to explore how they manage the fluctuations in demand that can come with construction, if there are any risks related to material costs or supply chain disruptions, how they bring in new business, and how much competition they face both locally and nationally. I’d also need to check on the condition of the FF&E and inventory, any licensing requirements, the roles and responsibilities of their staff, and the plans for relocation to a new facility.

5/ Commercial Printing Business

📍 Location: Rankin County, Mississippi
💰 Asking Price: $3,900,000
💼 EBITDA: $986,716
📊 Revenue: $2,167,489
📅 Established: N/A

💭 My 2 Cents: This commercial printer has carved out a very lucrative niche serving a loyal client base that comes back time and time again. They have nearly $1M in FF&E and inventory, providing a solid base of hard assets to support further expansion. The owner is also willing to stay on as general manager or CEO and is offering up to 10% seller financing with favorable terms, making this an appealing opportunity for a buyer seeking a turnkey business. However, I’d want to see their financials for the past five years to validate the stability of their cash flow and margins. I’d also need to really understand their specific niche (since their margins are much higher than the average printing business), who their key customers are and if there’s any concentration issue, and their average customer lifetime value and repeat business rate. Finally, I’d want to know when they were established, the number and different roles of their staff, and the condition of the FF&E. One bonus is the real estate is available for separate purchase, which would extend the amortization on an SBA loan up to 25 years and really improve your post-debt service cash flow.

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RECENT PODCAST EPISODES

How This Entrepreneur Acquired An IT Managed Service Company Through A Traditional Search Fund (link)

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THAT’S A WRAP

See you next Tuesday!

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Disclaimer

This publication is a newsletter only and the information provided herein is the opinion of our editors and writers only. Any transaction or opportunity of any kind is provided for information only; SMB Deal Hunter does not verify nor confirm information. SMB Deal Hunter is not making any offer to readers to participate in any transaction or opportunity described herein.