Technical Building Services in Germany: Focus on Facility Management
In the second edition of our market overview, we focus on technical facility management and the outstanding opportunities for entrepreneurs looking to sell their companies. Here are the key takeaways:
Excellent Opportunities for Sellers
- Companies specializing in technical facility management, including areas like refrigeration, HVAC, building security, building automation, and electrical engineering, are in high demand
- Mid-sized companies can expect attractive valuations ranging from 5-6x EBITDA for smaller, owner-managed businesses to 7-8x EBITDA and more for larger, professionalized setups, particularly those with a strong focus on service and maintenance. For some verticals such as TFM valuations can be even higher
Ongoing Consolidation & PE Activity
- Ongoing consolidation is particularly notable within building security, access control, and refrigeration & AC, which are some of the most interesting verticals for investors
- Numerous PE firms and family offices are actively seeking acquisitions, with 25+ platforms already in place. Many of these platforms have held their investments for 3+ years and are now focusing on further add-on acquisitions to strengthen their portfolios
- Some of these platforms are looking to initiate exits in the coming months, aiming to capitalize on their investments as market conditions remain favorable
Strong Interest from Foreign Investors
Foreign investors are increasingly attracted to the German facility management / building technology market, as well as other verticals like building security, access control, and refrigeration & AC. Their interest is driven by the access to Europe’s largest facility management / building technology market and the long-term positive outlook in these sectors. The growing demand for digitalization and energy efficiency further strengthens the investment appeal of these areas.
Favorable Market Conditions for Sellers
- The growing demand for digitalization and energy efficiency creates ideal conditions for entrepreneurs to capitalize on the value they’ve built
- Recurring and predictable (maintenance) revenues continue to boost valuations, making companies with solid, long-term service contracts particularly attractive to investors
Trends in Facility Management Development
- FM companies are increasingly developing towards technical expertise, with ever-increasing requirements in the areas of building automation and HVAC.
- Valuation estimates are likely to remain strong, as financial investors continue their interest in the sector, driven by high potential for continued growth.
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