📢 Deal Alert - Sailing school with 500K EBITDA & 4 more

Welcome to this week’s edition of Acquisition Alert!

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-Harry & Carter

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Table of Contents

• Sailing School Business

• Metal Fabrication Business

• School Bus Company

• Document Automation Software Provider

• Tree Service Business

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1. Sailing School Business

• Location: British Virgin Islands

• Asking Price: $1-5M

• EBITDA: $500,000

• Multiple: N/A

• Revenue: $1,500,000

• EBITDA Margin: 33% 

• Employees: 12

• List Date: 5/27/2024 

• Reason for selling: Retirement 

💬 Harry & Carter’s thoughts:

While this is the first sailing school company we’ve reviewed, it’s unlikely to be our last. At its core, this is a business that sells a certification by way of a training service, a very attractive value proposition. Importantly, this company doesn’t seem to own any boats, which we love - it’s extremely capex light (we assume the company rents boats on a seasonal basis and pays a high insurance premium). While we would need to inquire about these costs as a percentage of revenue, we are very comfortable with a lack of investment in a physical fleet of ships. The value of this company is most closely related to its stellar reputation and omnipresent brand in the sailing school world.

• Strong brand reputation - allowing premium pricing

• Positive topline growth and healthy profit margins

• Provides internationally recognized certifications

• Access to top-notch fleet, and high-quality instructors

❓️What does the $98,000 in inventory include?
❓️Where does the company rent the boats from? Contracts?
❓️What is the company’s cost breakdown: insurance, salaries, marketing?

Inquire:

Link to listing here

Broker: BusinessesForSale.com

Contact: NA

2. Metal Fabrication Business

• Location: Palm Beach, FL

• Asking Price: $3,500,000

• EBITDA: $1,00,000

• Multiple: 3.5x

• Revenue: $6,052,686

• EBITDA Margin: 17% 

• Employees: 20

• List Date: 5/28/2024 

• Reason for selling: Retirement

💬 Harry & Carter’s thoughts:

For ten years, this metal fab shop has grown at a solid pace and continues to expand its client base. While we often shy away from businesses that are heavily reliant on pricey capex expenditures, metal fabrication shops are a noted exception. However, it is crucial for the future buyer of this business to conduct thorough due diligence on the physical assets (waterjet, press brakes etc.) - understanding the condition and value of the machinery can make or break this investment. The metal fabrication industry is notoriously fragmented, which makes it a great sector for a roll-up strategy.

• Serves diverse client base = more stable revenue

• Quality assurance: Adheres to ISO standards

• Repeat business + referrals = underscores strong reputation

• Current owner works 25 hours/week

❓️What is the customer concentration?
❓️What is the condition and depreciation schedule of the machinery?
❓️What is the current marketing strategy?

Inquire:

Link to listing here

Broker: David Carson

Contact: 949-339-1500

3. School Bus Company

• Location: Essex County, NJ

• Asking Price: $1,250,000

• EBITDA: $500,000

• Multiple: 2.5x

• Revenue: $1,085,000

• EBITDA Margin: 46%

• Employees: 23

• List Date: 5/23/2024 

• Reason for selling: Retirement/Illness

💬 Harry & Carter’s thoughts: 

After 16 profitable years, the owner of this Essex County school bus business is retiring. With health concerns and a desire to step back, he has decided to sell the company that funded his five children's college and graduate education. The business boasts a 46% EBITDA margin, generating $500k in EBITDA. The purchase price includes 10 routes, 11 school buses, and a team of experienced drivers and aides. Opportunities for growth include adding more shifts, vehicles, or summer work. This deal offers a prime opportunity to enter a contractual, recurring revenue business with excellent margins and a low multiple.

• High EBITDA margin (46%)

• Low multiple (2.5x)

• Owner is pressured to sell

• Contractual revenue

❓️Does the business have long-term contracts in place?
❓️What condition are the 11 school buses in?
❓️What is the owner’s role in the business?

Inquire:

Link to listing here

Broker: Gerald Nimberg (Vested Business Brokers)

Contact: NA

4. Document Automation Software Provider

• Location: United States (Remote)

• Asking Price: $1,590,000

• EBITDA: $321,340

• Multiple: 4.9x

• Revenue: $942,258

• EBITDA Margin: 34%

• Employees: Unknown 

• List Date: 5/27/24 

• Reason for selling: Unknown

💬 Harry & Carter’s thoughts: 

This document automation software helps businesses convert paper documents into secure, organized, and searchable electronic libraries, leading to cost reductions and enhanced decision-making. With a broad client portfolio encompassing Fortune 100 enterprises, the company offers services like document capture, scanning, printing supplies, and automated document creation and distribution. Operating entirely remotely, the business is efficiently managed by a competent team, enabling the current owner to maintain minimal involvement.

• Absentee owner

• SBA pre-approved

• Market expected to grow by 15% through 2028

• High customer LTV

❓️Why is the owner selling?
❓️What happens to the numbers during a recession?
❓️Does the business have long-term contracts in place?
❓️What is the owner’s role in the business?

Inquire:

Link to listing here

Broker: Website Closers

Contact: N/A

5. Tree Service Business

• Location: New Jersey

• Asking Price: $1-$2.5M

• EBITDA: $310,000

• Multiple: 10.6x

• Revenue: $921,551

• EBITDA Margin: 31% 

• Employees: 4

• List Date: 5/25/24

• Reason for selling: Other business opportunities

💬 Harry & Carter’s thoughts: 

High margins often accompany tree-service businesses, and this company is no exception. We particularly like that this company serves both residential and commercial clients, with half of the revenue being recurring. The purchase price comes with high quality equipment, two experienced foremen, and an excellent reputation in the New Jersey area. While the company already leverages a CRM, marketing tools and a software system for scheduling purposes, we believe a new owner can continue to grow the business with additional product offerings (pesticide spraying, additional landscaping services, etc.).

• 50% of revenue is recurring

• Residential & commercial customers

• Streamlined operating procedures currently in place

• Assets include full fleet of tree service vehicles & equipment

❓️What does the competitive landscape look like?
❓️How many employees are part time?
❓️What is the revenue breakdown by service provided?

Inquire:

Link to listing here

Broker: CrossRoads Business Brokers

Contact: 949-753-2825

Thanks for reading and don’t hesitate to reach out! - Harry & Carter

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