PE consolidation of HVAC contractors is a multi-year trend driven by fragmentation

An ACHR/CEO Warrior explainer frames PE investment in residential HVAC contractors as a multi-year trend, attributing it to the industry's fragmentation and PE's appetite to consolidate, strip cost, and add value.

“The second reason is the fragmentation of the industry because private equity likes to consolidate. Unlike pest control, where a company like Orkin has a lion’s share of the business, there is not an HVAC company that has a similar market share. The thought process of private equity is to bundle contractors together, strip cost by combining resources, and improve capability, which leads to more value.”

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