Service experts seeks buyer

NASHVILLE, Tenn. — Three years after its formation and growth to the $600 million level, the consolidated contractor Service Experts, citing poor earnings projections, said it is seeking a buyer.

The acquirer may be a utility, an hvac manufacturer, or a mass retailer like Home Depot. In recent weeks, one rumored buyer was a major hvacr manufacturer, but the company has denied such reports.

The Service Experts development follows last week’s announcement that the publicly traded company would miss by 50% its projected quarterly earnings of 44 cents per diluted share, earning instead in the range of 23 to 28 cents. In response, the price dropped 38% to $12.63 a share in one day, where it remained last week.

Chairman Alan R. Sielbeck blamed bad weather, a fall-off in the company’s light commercial business (30% of its volume), and unexpected expenses in combining hubs (service centers) in three locations.

“Part of the reason was uncooperative weather, some was self-inflicted,” said Sielbeck.

The company also said its financial advisors have had “preliminary discussions with several potential acquirers.”

Corporate survival

This news underscores the difficulty of large contracting companies operating in the world of Wall Street. Disappoint the analysts and the reaction is quick and severe.

Nashville-based Service Experts went public on Aug. 16, 1996, opening at $13 a share. One year ago, it reached a high of $38 a share. In mid-February the shares dropped when the company cited warm weather for cooling its 1999 earnings.

During its life, the company has completed an aggressive roll-up of contractors. It now has 116 service centers in 36 states, focusing mainly on residential replacement and service work.

Each quarter the company acquired from 12 to 34 dealers in a cash-and-equity transaction. The company announced in April the acquisition of 31 dealers representing $48.8 million in combined sales.

Did you enjoy this article? Click here to subscribe to The NEWS Magazine

Recent Articles by Thomas Mahoney

You must login or register in order to post a comment.

Multimedia

Videos

Image Galleries

2015 ACCA Conference

Images from the 2015 ACCA Conference in Grapevine, Texas. Posted on April 8, 2015.

Podcasts

NEWSMakers: Mark Crockett
Mark Crockett vice president, Crockett Facilities Services, explains the importance of technician training, the value of being a top minority-owned company in the U.S., current projects the company is managing, and much more. Posted on April 24.
More Podcasts

ACHRNEWS

NEWS 05-04-15 cover

2015 May 4

Check out the weekly edition of The NEWS today!

Table Of Contents Subscribe

Legislation and Regulation

What legislative/regulatory issue is most important to you as a HVAC business owner?
View Results Poll Archive

HVACR INDUSTRY STORE

2015.jpg
2015 National Plumbing & HVAC Estimator

Every plumbing and HVAC estimator can use the cost estimates in this practical manual!

More Products

Clear Seas Research

 

Clear Seas ResearchWith access to over one million professionals and more than 60 industry-specific publications, Clear Seas Research offers relevant insights from those who know your industry best. Let us customize a market research solution that exceeds your marketing goals.

DON'T MISS A THING

Magazine image
 
Register today for complete access to ACHRNews.com. Get full access to the latest features, Extra Edition, and more.

STAY CONNECTED

facebook icontwitter iconyoutube iconLinkedIn i con