Joe Lewin, founder and CEO of corporate advisory firm DealFlowAgent, and Duncan Moore, Director of M&A, explain how electrical contractors can prepare their businesses for sale and strengthen their appeal to potential acquirers
An acquirer that approaches the owner of an electrical contracting business must decide whether the profit will continue after the ownership changes. Acquirers of more than one type have been active in UK electrical services.
In March 2026 a specialist services group acquired an electrical inspection, testing and compliance business. North American private equity firms have also announced investments in the sector. Warburg Pincus agreed to acquire a majority stake in the UK building compliance provider PTSG in May 2021, and H.I.G. Capital announced the acquisition of CPS Building Services in 2022. DFA expects an acquirer to apply four checks, and each rests on a record that an owner can prepare.
1. How much revenue repeats through inspection, testing and maintenance
Acquirers separate recurring inspection, testing and maintenance revenue from new installation projects, because recurring work repeats on a schedule while project work has to be won again. The Electricity at Work Regulations 1989 require in regulation 4(2) that systems are maintained so as to prevent danger so far as is reasonably practicable.
The 2025 amendment extends the five-yearly inspection duty in the 2020 electrical safety regulations in England to the social rented sector. For tenancies granted before 1 December 2025, 1 November 2026 is the date before which a registered provider must complete the first inspection.
Key action: Divide three years of revenue into recurring inspection, testing and maintenance work and new installation projects, and list each recurring contract with its renewal date and annual value.
2. Which accreditations the company holds
The NICEIC Approved Contractor Scheme assesses a contractor’s competence to carry out electrical work against BS 7671. An acquirer asks when each assessment falls due and what applies when ownership changes.
Key action: List every accreditation the company holds and its next assessment date, and ask the scheme in writing what applies when ownership changes.
3. How much of the business depends on named individuals
NICEIC requires a Principal Duty Holder and Qualified Supervisors, and a Qualified Supervisor needs at least two years’ responsibility for electrical work. In the March 2026 transaction, the acquirer’s announcement states that the founder and managing director will remain with the business.
Key action: For each major client, write down who holds the relationship, who prices the work and who signs the test certificates, and name a second person for each role.
4. How concentrated the clients are and what the contracts allow
Acquirers calculate each client’s share of annual revenue and read each contract for its renewal date, break clause and change-of-control terms. A contract that the client can end at short notice after a change of control gives less certainty about future revenue, so the acquirer applies a lower multiple.
Key action: Calculate the revenue share of each of the ten highest-revenue clients, and list the renewal date, break clause and change-of-control terms of each contract.
How the four checks change what an electrical contracting business is worth
Two electrical contracting businesses each reported EBITDA of £800,000 twelve months ago. EBITDA stands for earnings before interest, tax, depreciation and amortisation, and it is the annual trading profit to which an acquirer applies a multiple.
Over the following year the owner of the first business optimised the business and operating model so that each check could be answered in writing, and the owner of the second business made no changes. At assumed multiples of six times and four times EBITDA, the first business is worth £4,800,000 and the second is worth £3,200,000, a difference of £1,600,000 on identical profit. The multiples are assumptions chosen to show the arithmetic, and they are not market averages.
Key takeaways
Acquirers of electrical contracting businesses check four records: how much revenue repeats through inspection, testing and maintenance, which accreditations the company holds, how much of the business depends on named individuals, and how concentrated the clients are. An owner who can answer each check in writing gives an acquirer more confidence in the profit. Two businesses with equal EBITDA of £800,000 are worth £4,800,000 and £3,200,000 at assumed multiples of six and four.
