Jan 19th (Mon) 9AM NY

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Deal Alert: High-Growth Restoration + Construction Business With Real Cash Flow

📍 Location: Confidential (local-market dominant contractor)
💰 Asking Price: TBC
📈 2023 Financials: ~$5.0M Revenue | ~$610K SDE
📊 2024 Forecast: ~$5.5M Revenue | ~$737K SDE
🏗️ Services: Residential GC + Flood & Fire Restoration
🚨 Model: Emergency response + referral-driven projects
💼 Debt: Moderate operating debt + fleet/equipment cycle

🌟 Why This Business is Great:

Growth That’s Hard to Fake

Revenue climbed from $1.8M → $2.8M → $5.0M in just two years.
In construction and restoration, this usually means:

  • Strong reputation

  • Repeat customers

  • Operational capacity that can actually deliver work

This isn’t ad-spend smoke and mirrors — it’s execution.

Strong Gross Margins for the Industry

Gross margins sit around ~45%, which is solid for a GC/restoration hybrid.
That margin profile gives a buyer room to:

  • Tighten pricing

  • Improve job costing

  • Install better scheduling and labor controls

Even small operational improvements meaningfully increase EBITDA.

Restoration Adds Defensive Demand

Roughly 30% of revenue comes from flood and fire restoration, which brings:

  • Emergency, inbound demand

  • Insurance-backed budgets

  • Faster sales cycles

This side of the business can scale faster than pure remodeling when systems are in place.

Licensed, Certified, and Operationally Real

The company is properly licensed and certified for its work and offers 24/7 emergency response — not trivial to replicate.

This creates:

  • A local barrier to entry

  • Credibility with insurers and partners

  • More strategic value than a “truck + tools” contractor

🚧 Challenges to Watch

 Customer Concentration

Top 5 customers account for ~49% of revenue.
This isn’t fatal, but it must be addressed early by:

  • Broadening referral sources

  • Strengthening inbound channels

  • Reducing reliance on a handful of relationships

 Finance & Reporting Need an Upgrade

Financials are cash-basis, and 2023 numbers are internal (not audited).
Common at this size — but a buyer should expect:

  • Limited job-level visibility

  • Manual processes

  • Early investment in finance cleanup

 Operator-Dependent Today

At ~$5–6M in revenue, contractor businesses either:

  • Install systems and professional management

  • Or lose margin through chaos

This business will not scale cleanly without structure.

 Legal + Asset Diligence Required

  • Employment-related lawsuit in progress

  • Ongoing fleet/equipment replacement

  • Moderate debt to normalize in valuation

All manageable — but must be priced correctly.

🚀 Growth Levers I See

🔹 Scale Emergency Restoration

Emergency work is already proven.
More crews + better dispatch = faster, higher-quality growth.

🔹 Expand Commercial Work Selectively

Commercial is currently a small percentage of revenue.
Winning even a few anchor contracts can stabilize cash flow and reduce concentration risk.

🔹 Improve Pricing & Job Costing

This is a classic “same jobs, better math” opportunity.
Tighter estimating and post-job analysis can lift margins without increasing volume.

🔹 Professionalize Ops & Finance

Installing real reporting, KPIs, and project controls turns this into a scalable platform — not just a busy contractor.

🔍 My Analysis:

This is a solid, real-world acquisition with proven demand, strong growth, and healthy gross margins, but it’s not a hands-off deal. The business has reached a size where systems, pricing discipline, and financial visibility matter, and the next owner will need to professionalize operations to avoid margin leakage. Customer concentration and basic cash-basis reporting add risk, but they’re common at this stage and fixable with focused effort. The restoration side provides reliable inbound demand, and with better structure around operations, finance, and diversification, this business can scale into a durable cash-flow platform. In short, the fundamentals are strong, and the upside is real for an operator willing to install structure and lead.

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Recent Acquisition Stories:
Blackstone’s $4B Power Move


Blackstone is close to buying MacLean Power Systems for more than $4 billion, according to Bloomberg. MacLean makes the hardware used in power transmission—things like grounding products and anchoring systems that utilities depend on every day. Centerbridge bought the company in 2022, and Blackstone beat out other bidders, including ABB, to secure the deal.

💭 My Take

This is a smart, steady deal. MacLean sells the parts that keep the electrical grid running, and that demand doesn’t go away in a recession. The U.S. grid needs upgrades, and electrification is growing fast. Blackstone isn’t chasing hype—they’re buying a quiet company with predictable cash flow and long-term need.

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