The private equity owner of American Residential Services (ARS) is exploring a sale of the heating, ventilation, and air conditioning (HVAC) and plumbing services provider that could value it at over $3.5 billion, according to three sources familiar with the matter.
Investment bank Rothschild & Co’s Business Services franchise is running the sale process, which is at an early stage, the sources said, requesting anonymity because the matter is private.
The potential sale comes as private equity firms continue to favor residential services investments, a sector that remains resilient during periods of market volatility due to steady, recurring demand.
Private equity firm GI Partners is the majority owner of ARS after making an investment in 2020. Existing investor Charlesbank Capital Partners and the company’s management remained invested in the business.
GI Partners and Rothschild declined to comment. ARS did not immediately respond to a request for comment.
Memphis, Tennessee-based ARS generates around $200 million of annual earnings before interest, taxes, depreciation and amortization and over $1.5 billion of revenue, two of the sources said.
Private equity firms have been active buyers of residential services companies. Last month, Blackstone bought home services provider Champions Group for an undisclosed amount. Earlier this month, Reuters reported that Oak Hill Capital agreed to buy Guild Garage Group, an alliance of garage door repair and replacement businesses, for more than $800 million.
ARS completes 1.2 million customer visits per year and employs over 6,000 people, including over 2,500 skilled technicians, according to GI Partners’ website.
Founded in 2001, GI Partners invests primarily in healthcare, software and services companies and has raised more than $47 billion to date.
Source: Reuters.com