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Retail Supplier Parent to Acquire HVAC, Water Heater Services Provider; Evaluating Purchase of Retail Books
ONEnergy Inc., the parent of Sunwave Gas & Power, has agreed to acquire The Home Comfort Group Inc., a provider of heating, ventilation and air conditioning products and solutions to homeowners in Ontario, Alberta and Manitoba, for total consideration of $3.4 million (all $ Canadian).
ONEnergy said that the acquisition of Home Comfort Group (HCG) is expected to be "synergistic" with ONEnergy's Sunwave Gas & Power business, "with multiple cross-selling opportunities for both businesses."
"ONEnergy also expects the combined businesses will be well positioned to accelerate the launch of new products and services in Canada and the US, both in existing service territories as well as in new markets."
The all-cash transaction is expected to be immediately accretive to cash flow, and is scheduled to close by the end of April 2014, subject to closing conditions typical for transactions of this type, ONEnergy said.
HGC serves over 4,000 customers.
ONEnergy said that HCG, "is a well-established leader in the residential HVAC rentals, sales and installation business and provides heating and air conditioning equipment, tankless and conventional hot water systems and other in-home and commercial appliances, products and services."
"The Company drives revenue through the sales, rental and installation of high quality, energy-efficient HVAC systems, providing the business with long-lived, stable annuity-type cash flows and 'sticky' customer relationships," ONEnergy said
"This important transaction expands our customer base, accelerates our growing range of product offerings and extends our reach into new markets in Canada," stated Mark J. Lewis, CEO of ONEnergy. "Our objective is to grow our business across North America by offering a variety of value-added products and services that save our customers money, improve their quality of life and that are good for the environment. HCG has an excellent product and service offering, strong growth and an excellent reputation, all of which are attributes that fit well in our model. We view this as a great opportunity to benefit from operating synergies, grow our top and bottom line as well as add products and services that fit well with our US expansion."
ONEnergy said that it is, "pursuing a two-pronged strategy of building its core energy retailing business through organic and inorganic customer growth initiatives, while also increasing the value of each customer."
"The Corporation is strengthening and growing its energy retailing business through the organic expansion of its Canadian customer base, as well as via its ongoing expansion into the US Northeast markets. Additionally, ONEnergy is actively evaluating potential acquisitions of existing small to mid-size energy retailers in key US markets. The North American energy retailing industry is robust, but highly fragmented, and the Corporation expects further retail supplier consolidation," ONEnergy said.
"In addition to growing its customer base, ONEnergy will focus on continually improving and expanding the value proposition offered to customers by offering complementary services and products as part of their relationship with ONEnergy. The retail energy markets are experiencing a paradigm shift where customers are demanding a more comprehensive relationship with their energy provider. ONEnergy is at the forefront of this shift and is taking steps to provide a comprehensive menu of value-added services designed to enhance the customers experience and range of services, increasing the margin derived from each customer while improving customer retention," ONEnergy said.
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April 10, 2014
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Copyright 2010-13 EnergyChoiceMatters.com
Reporting by Karen Abbott • kabbott@energychoicematters.com
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