PE HVAC Platform Investment and Exit Strategy

Private equity firms typically acquire a large HVAC company as a platform investment, grow it through add-on acquisitions, and then exit by selling to another PE firm or taking it public. The sale to another PE firm is the most common exit path and the primary way PE investors realize returns.

“In the current wave of HVAC consolidation, the PE’s initial acquisition is often in a large HVAC company that is called their “platform” investment. They then grow that platform primarily via additional “add-on” HVAC acquisitions. Once they have significantly increased the size of the platform via acquisitions, the PE firm exits that investments by either selling the platform to another PE firm or by taking the business public. The former option being by far the most common.”

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