On Monday, American Capital Ltd. (ACAS) declared its investment in the One Stop Buyout of Service Experts, LLC. The deal was conducted by Special Situations Group, a unit of American Capital. The company invested in the form of preferred and common equity and a revolving credit facility. However, financial terms of the deal were not disclosed.
American Capital anticipates the deal to be accretive based on its returns and expects to continue seeking new One-Stop Buyout opportunities or supporting private equity buyout.
Based in Richardson, Texas, Service Experts provides complete HVAC services, including maintenance, inspections, sales and equipment installation of heating and air conditioning and cooling systems. Moreover, Service Experts provides indoor air quality solutions along with energy-saving green solutions. The company operates through 108 branches in the U.S. and Canada and records about $385 million in annual sales.
Therefore, the deal with Service Experts is expected to be a strategic fit for American Capital as the company will be armed with a large infrastructure. Moreover, combined with American Capital’s industry expertise, commendable operational and marketing skills, Service Experts aims to expand its existing national customer base. Additionally, the company expects to offer a broad range of products and grow revenue both organically and through acquisitions.
American Capital has the capability to provide flexible financing solutions ranging from a variety of senior debt and uni-tranche to mezzanine and equity co-investments. Further, the company provides multi-currency funding with underwriting platform globally and facilitates the growth of portfolio companies. Such benefits induce private equity clients to consider it as an investment partner, which in turn helps the company broaden itself.
Currently, American Capital retains a Zacks Rank #2 (Buy). Among peers, companies in the same industry with Zacks Rank #2 include Medallion Financial Corp. (TAXI), Hercules Technology Growth Capital Inc. (HTGC) and KCAP Financial Inc. (KCAP).
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