Columbia Home Services, P1 Service Group near merger

HVAC, plumbing, and electrical roll-ups, Columbia Home Services and P1 Service Group, are set to merge in a deal that will value the combined firm at around $325 million, including debt, according to multiple people familiar with the matter. 

The big picture: The deal will mark the third platform-level HVAC transaction this year, following, most recently, Redwood Services’ announcement that Altas Partners will acquire a majority stake — and represents the first true merger between established groups. 

• What’s happening: The merger will create a combined firm with trailing-twelve-month EBITDA of roughly $27 million, the people said, requesting anonymity as the matter is confidential. The valuation reflects a 12x multiple applied to each company’s annualized EBITDA of between $12 and $15 million, the people added.

Zoom out: Based in Dallas, Texas, Columbia Home Services — backed by Tenex Capital Management — has partnered with 10 contracting businesses across the U.S., including in California and North Carolina, and is set to purchase an 11th from Air Pros as part of the company’s bankruptcy proceedings. 

• P1 Service Group, whose sponsor is Edgewater Funds, counts nine brands across Florida, Pennsylvania, and Oregon. The merger will effectively double each company’s size, creating a single, larger platform with 20 brands nationwide. 

What’s next: Both companies’ leadership is expected to remain involved, sources say, adding that, pending approval, the deal could be finalized in the coming weeks.

A representative for Columbia declined to comment, and P1 didn’t return a request for comment.

Editor’s note: This story has been updated to reflect a third platform-level transaction this year. (Fix-It Group’s January sale to Two Parks Capital)