Maintenance Agreements as PE Value Driver

PE acquirers pay a significant premium for HVAC companies with strong recurring maintenance agreement books, valuing that revenue at 10-12x compared to 4-6x for emergency repair revenue, due to the stability and predictability it provides platform earnings.

“PE acquirers will often pay a significant premium for companies with strong, recurring maintenance agreement books. A company with $1 million in annual maintenance agreement revenue might be worth 10–12x that maintenance revenue, compared to 4–6x revenue multiples on the emergency repair side.”

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