Limbach Inc. has agreed be sold in a $97 million deal that with take the mechanical HVAC construction contractor public.
Holding company 1347 Capital Corp. announced the deal March 23. Under the agreement, Limbach’s current owners will receive $60 million in cash and stock from 1347 Capital, and an additional $15 million to $25 million in equity.
1347 Capital said it plans to raise $40 million in debt financing as part of the transaction.
Gordon G. Pratt, president and chief executive of 1347 Capital, said he is excited to be partnering with Limbach.
“Limbach has a long and proud history of delivering value for its blue-chip customer base of general contractors and end-users,” Pratt said. “We believe that this merger will allow the company to achieve greater scale and leverage its management, engineering, and financial infrastructure, which are very highly evolved for a company of its current size. Limbach stands out both for its engineering/design-build services and its vertically integrated fabrication and assembly capabilities, thus reducing costs, increasing reliability, and speeding construction when compared to standard build-on-site procedures.”
Limbach CEO Charlie Bacon said he expects great things for Limbach from the transaction.
“Becoming a public company is an important milestone in Limbach’s history, and we believe that the timing is right for the company to leverage the opportunities we see in the marketplace by having access to the capital markets in support of our multi-faceted growth strategy," Bacon said. "Non-residential construction markets have recovered from post-recession lows and our deep engineering capabilities are a key differentiator that we do not believe is easily replicated by our competition. Improved access to capital and a robust corporate infrastructure further differentiate Limbach, both in the pursuit of individual project opportunities, and as we explore acquisitions to expand our geographic footprint and to add complementary lines of business.
"We are pleased to take the next step in the evolution of Limbach, as the capital markets will provide our company with a wider range of financing options to fund our future growth,” he said.
Limbach had $331 million in revenue during 2015. The deal is expected to close by July.